Staff at Cumbrian Newspapers (CN Group) are threatening industrial action against proposals to freeze the company’s defined benefit (final salary) pension scheme for all members of staff.
Some employees could be thousands of pounds worse off after they retire, under a proposed new scheme, according to the National Union of Journalists (NUJ).
Many companies have closed their final salary pension schemes to new members, but the NUJ claims that none of them has taken the step of closing the scheme to existing members.
Cumbrian Newspapers – whose stable of products includes the Cumberland News, News & Star, Times & Star, Whitehaven News, North West Evening Mail, Hexham Courant and Eskdale & Liddesdale Advertiser, along with Cumbria Life magazine, the Barrow Advertiser and radio stations across the North West – wants to introduce a defined contribution scheme.
NUJ president Chris Morley told the Press Gazette: “It has come as a bolt from the blue. The company has acted unilaterally and one of the points the union has made is that there was no attempt to flag up the problems with the chapels.
“Instead, it has gone to the whole workforce and said it is ripping up the promise it made when the workers started with the company for something vastly inferior.”
The NUJ has calculated that some people could be losing tens of thousands of pounds in their retirement.
An employee with 14 years’ service would be between £2,500 and £4,000 a year worse off when they retire, and if they lived to the age of 82 would lose up to £69,000, it said.
Cumbrian Newspapers said it had to address a £7.7m deficit in its pension scheme and said it would be putting in £600,000 per year to address the deficit over the next 15 years.
Chief executive Robin Burgess said: “This isn’t a cost-saving exercise. We envisage that it is probably going to cost us more. It’s about assessing risks to the company.
“We have been advised that if our present scheme ran on for 15 years, the size of the deficit would be such that, it could have a catastrophic effect on the company’s finances.
“We are treating the whole company from myself downwards the same. No-one would be left with a final salary scheme.”
But a spokesman for the NUJ’s National Executive Council told Press Gazette: “The NEC believes the move is a betrayal of promises made to staff when they joined the scheme.
“It is also a denial of the chance of achieving a decent pension for future workers, and we have, therefore, agreed to support CN Group chapels in their efforts to keep a decent pension scheme, to make available money from the union’s £1m fighting fund as deemed appropriate to win a just settlement, and make common cause with Amicus to defend the final salary scheme.”