Higher pension for AIB workers

A Labour Court recommendation last year has meant that AIB is contributing up to three times the national average to its workers’ pension pots.

An Irish Association of Pension Funds report at the end of May found that, on average, employers across the economic spectrum are contributing 5.7% of salary to their workers’ pensions.

However, workers at AIB can expect up to 18%, thanks to a July 2013 Labour Court recommendation.

That recommendation, which came as the bank’s defined benefit pension scheme was closed, contained the findings of a technical group, which said the standard contribution the bank should make to its new defined contribution scheme for all employees should be 10%.

It said for workers under 40 years of age, there should be a further “1 for 1 employer contribution” of 2%, for those aged 40-49 the further contribution should be 5% and for those over-50 it should be 8%.

The court explained the difference in contributions by saying that, in its consideration of new defined contribution arrangements, the technical group looked at the impact on members’ retirement benefits at retirement posed in moving from defined benefit to defined contribution arrangements for staff “with a wide spectrum of potential service to normal retirement date”.

Both sides accepted the recommendation of the technical group and it is now in operation.