Ruling expected on Irish pilots' DB/DC test case
Ireland - The Irish Pensions Board is expected to rule shortly whether the Irish Airlines (Pilots) Superannuation Scheme (IASS) is a defined benefit (DB) or defined contribution (DC) scheme.
A spokesperson for the Pensions Board said that a ‘draft determination’ had been sent to interested parties for comment and a ruling was expected in the next few weeks.
This follows an appeal by IMPACT, the trade union representing Aer Lingus pilots, to the Board to resolve the issue. The ruling is being seen as a test case since it could affect the terms of future government privatisations. The Government has been attempting to privatise Aer Lingus for the past three years.
The dispute is over the description of the IASS pension fund in the 2002 annual report as a ‘targeted benefit’ scheme, rather than a DB scheme. IMPACT said they believed the pension to be a DB scheme with a guaranteed pension on retirement.
The union said the change in terminology altered the nature of the guarantees made to their members, since they are now getting only an ‘aspirational commitment’.
Aer Lingus said they had not changed the rules governing the plan and did not plan to do so. It said that the scheme was described as a targeted benefit scheme to comply with new accounting regulations.
The IASS fund is funded jointly by the company and its employees with each contributing 6.875% of gross salary.