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Unions and Pensions
Meeper
Posts: 1,394 Forumite
I saw a client this morning who works at a local manufacturing company. They are a very large organisation, and the majority of the workforce are members of their Union. Contributions from the employees to the union from this company alone total approximately £750,000, just to give you an idea of the size of the company. My client was paying them £17.50 per month. You do the maths.
Anyway, we weren't discussing pensions, as I know that he is part of their Group Money Purchase scheme, which is a pretty solid contract with good flexibility, decent enough funds, and low cost. We were talking about mortgages and protection. But that's another story.
Anyhow, he mentioned that their union had basically told the entire workforce that the current pension provision that they have is inadequate and recommended to all of their members to pull out of the pension scheme run by the employer. They have also rejected a 3.5% pay increase, £750 lump sum payment for every full-time employee, and a guaranted 2.5% pay increase for the next 2 years also. They demand more! Those employees were counting on their lump sum payments to cover Christmas, etc, and they no longer have it because the union has rejected the proposal.
The biggest problem by far, however, is that employees all through the company are pulling out of the perfectly adequate group scheme into which the employer contributes, and they are not replacing it with anything else. Even if they did replace it, the employer will no longer contribute. When is the government going to take action against these unions for giving "advice" to their members? Their advice should be properly regulated and they should have to be responsible for their words to members. If I advised someone to leave that scheme, I'd be the subject of a complaint in a few years. Will the union be subject to 3000+ complaints? Of course not. They will wash their hands of the whole situation when it hits the fan.
Unions were necessary in the 70's and 80's when there was no employment law to speak of. Nowadays you can't even fire someone for failing at their job without giving them about 5 years worth of training programmes and development plans. HR departments run companies, not management. The need for unions is over. But that's a separate rant. For now, I'd settle for them having to be liable for the "advice" that they give to their members, because what they are doing at the moment in this case, and in the case of the local authority and teacher's pensions, is scandalous and a disgrace.
M.
Anyway, we weren't discussing pensions, as I know that he is part of their Group Money Purchase scheme, which is a pretty solid contract with good flexibility, decent enough funds, and low cost. We were talking about mortgages and protection. But that's another story.
Anyhow, he mentioned that their union had basically told the entire workforce that the current pension provision that they have is inadequate and recommended to all of their members to pull out of the pension scheme run by the employer. They have also rejected a 3.5% pay increase, £750 lump sum payment for every full-time employee, and a guaranted 2.5% pay increase for the next 2 years also. They demand more! Those employees were counting on their lump sum payments to cover Christmas, etc, and they no longer have it because the union has rejected the proposal.
The biggest problem by far, however, is that employees all through the company are pulling out of the perfectly adequate group scheme into which the employer contributes, and they are not replacing it with anything else. Even if they did replace it, the employer will no longer contribute. When is the government going to take action against these unions for giving "advice" to their members? Their advice should be properly regulated and they should have to be responsible for their words to members. If I advised someone to leave that scheme, I'd be the subject of a complaint in a few years. Will the union be subject to 3000+ complaints? Of course not. They will wash their hands of the whole situation when it hits the fan.
Unions were necessary in the 70's and 80's when there was no employment law to speak of. Nowadays you can't even fire someone for failing at their job without giving them about 5 years worth of training programmes and development plans. HR departments run companies, not management. The need for unions is over. But that's a separate rant. For now, I'd settle for them having to be liable for the "advice" that they give to their members, because what they are doing at the moment in this case, and in the case of the local authority and teacher's pensions, is scandalous and a disgrace.
M.
I am an Independent Financial Adviser
You should note that this site doesn't check my status as an Independent Financial Adviser, so you need to take my word for it. This signature is here as I follow MSE's Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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I have to agree with 100% of your argument.
Unions have in the past, performed a useful and necessary function. But today seem to be full of union reps who are in 'never never' land in their thinking. They think money, company sales and prospects/profits, and the economy are supplied by a magic tree or something. They advise employees to ask for things that could put their companies out of business and them out of work.
And i truly am beginning to think it should be made law that Union reps are not allowed to discuss pensions with their members, as all they seem to do it try to put people off joining them even if they are good.0 -
I'd start an e-petition on the government's website, but I don't think there are 100,000 people left in the UK who the various unions wouldn't blacklist for signing!I am an Independent Financial AdviserYou should note that this site doesn't check my status as an Independent Financial Adviser, so you need to take my word for it. This signature is here as I follow MSE's Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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I saw a client this morning who works at a local manufacturing company. They are a very large organisation, and the majority of the workforce are members of their Union. Contributions from the employees to the union from this company alone total approximately £750,000, just to give you an idea of the size of the company. My client was paying them £17.50 per month. You do the maths.
Anyway, we weren't discussing pensions, as I know that he is part of their Group Money Purchase scheme, which is a pretty solid contract with good flexibility, decent enough funds, and low cost. We were talking about mortgages and protection. But that's another story.
Anyhow, he mentioned that their union had basically told the entire workforce that the current pension provision that they have is inadequate and recommended to all of their members to pull out of the pension scheme run by the employer. They have also rejected a 3.5% pay increase, £750 lump sum payment for every full-time employee, and a guaranted 2.5% pay increase for the next 2 years also. They demand more! Those employees were counting on their lump sum payments to cover Christmas, etc, and they no longer have it because the union has rejected the proposal.
The biggest problem by far, however, is that employees all through the company are pulling out of the perfectly adequate group scheme into which the employer contributes, and they are not replacing it with anything else. Even if they did replace it, the employer will no longer contribute. When is the government going to take action against these unions for giving "advice" to their members? Their advice should be properly regulated and they should have to be responsible for their words to members. If I advised someone to leave that scheme, I'd be the subject of a complaint in a few years. Will the union be subject to 3000+ complaints? Of course not. They will wash their hands of the whole situation when it hits the fan.
Unions were necessary in the 70's and 80's when there was no employment law to speak of. Nowadays you can't even fire someone for failing at their job without giving them about 5 years worth of training programmes and development plans. HR departments run companies, not management. The need for unions is over. But that's a separate rant. For now, I'd settle for them having to be liable for the "advice" that they give to their members, because what they are doing at the moment in this case, and in the case of the local authority and teacher's pensions, is scandalous and a disgrace.
M.
Did the workforce not vote on accepting/rejecting the compant pay offer?
Sometimes a union will routinely reject an initial offer if they think there is more money available. The union reps could be very experienced in this type of negotiation and know from past experience that the company will offer more.0 -
maybe you could say which compnay it is so we can take a unbiased view on the situation
there are many reason why people are dropping out of pension provision, partly financial pressure, partly a lack of confidence caused by constant government interference, lack of trust in pension providers, and yes maybe poor information from unions (although I don't see how this helps unions )0 -
there are many reason why people are dropping out of pension provision, partly financial pressure, partly a lack of confidence caused by constant government interference, lack of trust in pension providers, and yes maybe poor information from unions
Those might be reasons, but they aren't good reasons!The biggest problem by far, however, is that employees all through the company are pulling out of the perfectly adequate group scheme into which the employer contributes, and they are not replacing it with anything else.
This is far from being the first case we've seen lately of unions deceiving their members by spreading disinformation and lies to further their own political ends.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
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How much profit did the company make this year?
Profits need to be channeled into investment for growth, retention for a rainy day, acquisitions, and providing at least some reward for long-suffering shareholders if the company is a Plc.
Salaries and benefits are overheads, which need to be covered by earnings, but having excess earnings (profits) is by no means a reason to be overpaying for your labour!
If a company does want employees to benefit from the companies success (which I personally regard as being a good thing), this needs to be done via schemes other than direct labour costs as otherwise the company will hit the rocks during difficult times.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
The employees will need to go into NEST from next year depending on the size of the companyMortgage May 2012 - £129k
January 2015 - Mortgage down to £114k
Target for 2015 to get down to £105k0 -
How much profit did the company make this year? What are the inflation predictions for the next 2?
You obviously have no idea about economics and the basic principles of running a company. While i do feel that employees should always share in companies good fortune if things are running well, rejecting a proposal that included a fair wage increase (we haven't seen one for over 4 years) plus guranteed future ones,
and a lump sum payment in this economy with others losing their jobs all round and other companies closing by the day is fairly ridiculous. Not to mention all the other perks of these jobs not mentionned which I am going to assume will include company pensions, and even other great perks like private healthcare, sharesave schemes etc.
Kinda like the Unions trying to force BA to give heathrow CC their old 70s-80s-90s style pay and conditions when no one else (still in business) gives such a deal- AND while other CC based in other BA UK airports like Gatwick don't get the same. And trying to put the company out of business while they do it. It beggars belief really.0 -
You obviously have no idea about economics and the basic principles of running a company.
I do, what I don't have any idea about is how that company is doing or has treated its employees recently - if the've imposed a 10% pay cut over the last couple of years whilst returning record profits & have their order books full then the TU rejecting a middle of the road pay offer would be a reasonable negotiating position0
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