Updated 6.57pm
MINISTER FOR TRANSPORT, Leo Varadkar, has urged all parties involved in the dispute over the Aer Lingus pension fund to accept an expert panel’s recommendations after the airline confirmed earlier today that it would.
Aer Lingus “reluctantly” agreed to pay €191 million into its employee pension fund.
The board of the airline made the decision on the recommendation the expert panel formed earlier this year to resolve a dispute between Aer Lingus and employees in its general pension scheme.
The panel was established after the pair failed to agree how to implement the recommendations of the Irish Labour Court.
Chief executive Christoph Mueller said that the new solution involved “a significant increase in payments” from the company.
Aer Lingus and the Company reluctantly accept the recommendations of the expert panel as the only solution that is capable of acceptance by all the parties.
The expert panel report significantly added to the final bill for the company, which had been pencilled in at €110 million by the Labour Court, only to be bumped up to €146.7 million by the body comprised of trade unions, the Government and IBEC.
In addition to this payment, Aer Lingus has also had to increase the sum paid to deferred beneficiaries up to €44 million.
Best and last opportunity
Responding to the news today, Varadkar said he welcomed the response and the statement from Dublin Airport Authority that it believes the panel’s recommendations represent ‘the basis for a final and complete resolution of pension arrangements’”.
The DAA has also reaffirmed its commitment to engage with all stakeholders. The minister said the panel’s report provides the “best and last opportunity” to resolve the long-standing difficulties in the pension scheme.
He urged all other parties involved to also accept the recommendations.
Implementation
In a statement, the airline said that the resolution “could mitigate the significant industrial relations and other risks related to the funding difficulties faced by the IASS [pension scheme]“.
It said that a drop in staff costs, as per its original plan, is still possible by 2017 under the strictures of the new arrangement. Board and shareholder approval for the once off payments must still be secured.
As part of the implementation process, Aer Lingus will also look to streamline the establishment of an internal dispute resolution mechanism.
- Additional reporting by Michelle Hennessy.
First published 10.17am
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