ANGRY ATKINS staff this week circulated a letter to colleagues involved in the firm's pension scheme seeking their signature of support for a protest against the company's decision to wind up the final salary scheme.
In the letter addressed to chief executive Keith Clarke and leaked to NCE this week, staff accused Atkins of proteering at their expense and failing to adequately consult them on the changes.
Earlier this month the consultant announced that it was closing its final salary pension scheme from 1 July and would switch the 2,000 members remaining on the scheme into a defined contribution scheme (NCE 22 March) Its final salary pension deficit is currently £187M, up from £69M in 2004. The huge increase is due to new accounting rules that require companies to recalculate likely pension payouts based on people living longer.
As a result of these changes many employers are ditching al salary or dened benet schemes in favour of dened contribution schemes because it frees them of the obligation to pay out a pre-agreed sum.
Atkins group human resources director, Alun Grif hs, said the company had already ploughed £22.5M into reducing the debt and planned to put in another £140M over the next ve years.
But in the letter to Clarke, staff said they believed Atkins would profit from the switch at their expense and that the change would result in a 12% reduction in employer's contribution to pension funds and leave them with 20% less when picking up their pension.
'This saving at our expense is being used to substantially contribute to the pension decfiit. rather than to our individual pension plans, ' says the letter.
The letter warns that the change is 'not respectful and extremely unfriendly' and is risking the continued goodwill of staff. They have written that 'the significant increase in share price immediately after the proposed changes were announced gives a graphic indication of the commercial benefit that Atkins will gain'.
Griffiths told NCE this week that the firm was 'mid-way through a consultation process.
We've presented a package of proposals and will consider all feedback.' He added: 'There is widespread misapprehension about company pension schemes. The company provides a pension scheme that staff have the right to buy into, but the company retains the right to change the terms of that scheme.
'All the rights accrued so far are fully protected. Nobody's removing contractual entitlements. But we are modifying the terms on which future pensions will be provided.' He said that 'the costs to the company are in reality very little different to what they were before'. But he added: 'The days of the final salary pension scheme are past. There needs to be a far better apportionment and understanding of investment risk.'