Six hundred employees of the non-unionised Standard Life attended packed meetings in Edinburgh yesterday organised by trade union Amicus which pledged to fight plans to cut pension rights.
However, after the meetings, the company talked up the role of the traditional staff association in brokering the changes which will move 6000 final salary pension scheme members to an inferior career average basis.
Standard's spokesman Scott White said: "The company believes that through our joint commitment to working in partnership, and our long established relationship with the staff associations, they are effective in ensuring that employees are well represented."
But he went on: "Standard Life is committed to employee recognition that suits our employees.
"If Amicus approaches us we will respond appropriately to them which could potentially lead to further discussions."
David Fleming, national financial sector officer for Amicus, said: "The staff association is an internal organisation. We believe the pension schemes have been imposed, and that is why 600 people turned up, at their behest, not ours."
It emerged that Standard has funded its staff association to obtain legal advice on its proposals. "That's not good enough," Fleming said. "The reason people are turning up in their hundreds is they are crying out for someone with skill and experience throughout the finance sector to make sure they are not patronised by a paternalistic organisation it is a wake-up call to the company."
Although the meetings were subdued, Standard Life staff involved in the internal consultations said afterwards that there had been a bitter reaction across the company against the inflation-capping of past service benefits.
"It is about trust, and there is a feeling of betrayal," said one, who did not want to be named. "I don't think anyone is up in arms about changing the scheme going forward, it is about the retrospective changes.
"They have cut the anchor for why loyal staff with 10, or 20 years service should remain going forward - we have always been told it is the benefit package as a whole that counts and that it was competitive. Well, we are getting a retrospective pay cut."
Some of the anger has been focused on Standard's claim that it had warned about the impending cuts in its flotation prospectus. In a 600-page document, one sentence on page 126 reads: " The board has communicated to employees its intention to restrict pensionable increases in remuneration to inflation."
The staff campaigner added: "The perception now is there was a deliberate policy of poor communication on this before demutualisation."
He said the company's original proposals in November had shocked staff. "Quite apart from the injustice of the proposals, the (original) presentations were dishonest and misleading, and the people who were the most up in arms were the actuaries - they could understand the figures."
Trevor Matthews, head of Standard's life pensions and business, admitted to The Herald last night: "Clearly we failed in our communication. The full impact of what was happening only became visible to people when the proposals came out."
Another company source said: "We made commitments to our shareholders that were needed to guarantee support."
Standard's proposals are more radical than similar initiatives by financial groups which are still in the "mutual" sector.
Co-operative Bank moved to a career average scheme last year but it stressed: "Benefits accrued within the current schemes will continue to be linked to final pensionable salary on retirement or on leaving service, whichever is earlier. The new career average arrangement will only apply to any pension accrued after April 5, 2006."
Nationwide moved to career average calculation in 2002, but only for new members.
In a closer parallel, Clydesdale Bank last year moved employees from final salary to career average and put an inflation cap on past accrued benefits, but Fleming commented: "Their starting position was extraordinarily harsh and draconian. We were able to negotiate independently."
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