In another example of how private sector unions benefit their members, Axa UK employees are threating to strike over an end to defined-benefit pensions:
Unite's national officer, Dominic Hook, said: "The move to end the defined benefit pension scheme at Axa is appalling and unjustified. Long-serving staff now face the prospect of having to work an extra five years to get the same level of pension and [the move] puts all the investment risk on to the staff."There's one slight problem with Mr. Hook's threat. The final salary scheme has been closed to new members since 2003 - ten years ago. The only employees still on this scheme have been with the company for over 10 years. Axa reports that 2300 staff are affected, which looks to be about 30% of employees.
He added: "The decision by Axa is unacceptable and industrial action will be among the options being discussed with members if Axa refuses to reconsider its proposals."
If I were a newer member of staff at Axa, on a defined contributions pension, I'd imagine that my sympathy for staff on a massively superior defined-benefit scheme would be rather limited. Note that they keep any benefits accrued to date, this proposed downgrade would only affect the benefits they earn from now onwards. Just why I should strike, and lose a day's pay, for the benefit of someone earning much more than I do, is not entirely clear to me. I'd imagine the company would also secretly be happy to have an excuse to performance-manage expensive staff if they strike for any significant length of time. After all, what are they going to do if Axa don't give in? Quit? Where are they going to find a job with even vaguely comparable benefits?
I'd respect Dominic Hook more if he were honest about the situation:
"Our members recognise that they have very little leverage in this situation, but nonetheless feel betrayed by Axa.. mumble, mumble, fat cat executive salaries and the bleeding lips of the starving poor, mumble, mumble, ... they can impose this change but they can't make us like it."I suspect, though, that such a declaration would make Unite's impotence clear, and lead many members to wonder exactly what their union dues are buying them. If Unite actually had the interests of the majority of Axa workers at heart, they'd be lobbying the Government to up the Bank of England's inflation target and make it stick to it, in order to give savers (and hence yields) an income more than derisory.