On 15 March 2017 employees of the German car maker, BMW, protested in Britain due to the closure of the UK defined benefit pension scheme. This was an announcement that came from Unite, a union in the United Kingdom.
The protests took place in Cowley in Oxfordshire and at Hams Hall engine plant based in the West Midlands where British employees decided to band together and protest about the closure of the company’s United Kingdom defined benefit pension scheme.
This leading car maker announced their closure of the United Kingdom defined benefit scheme six months ago. They were moving the scheme to future accrual, which affects more than five thousand people. The protests came six months after this announcement as employees decided to fight the decision to secure their own futures in the long run. It was decided that all future contributions would be placed in a defined contribution scheme.
The decision on whether to accept the proposal by BMW closed on 31 March 2017 and affected workers in Cowley, Goodwood, Farnborough, Hams Hall and Swindon. The union, Unite did advise that the protests were following the latest results released by BMW last month showing an eight percent increase in their net profit, which amounts of £5.99 billion or 6.9 billion Euro.
Unite also advised that there had been record sales recorded of Minis in the past year along with a six percent increase in sales of Rolls-Royce. Workers who were protesting would be pushing their colleagues to back industrial action as a result, sending a message to BMW that they will not accept the decisions taken by the company regarding their defined benefit pensions.
BMW’s sales that reached record high were contributed to by the United Kingdom workforce and they do deserve better than the broken promises that have been made by BMW regarding their pensions and the company’s mention of poverty. BMW, which is a German car manufacturer, needs to see what a role the United Kingdom work force plays in their success and work with the union to come to a resolution that workers and the company can be happy with to safeguard the workers pensions in the long run.
BMW did come forward and commented that they do provide excellent pension schemes for all their employees and they are proud of what they offer their workforce and this will result in their immediate actions to protect the pension provision in the future. Discussions are still going on and more meetings are due to take place in the near future to resolve the issue.
Royal Mail workers asked their employer not to close their defined benefit scheme only a day before the protest to a new accrual. The Royal Mail workers asked for a hybrid scheme of DB-DC.
At the same time the government is looking for ways to make the defined benefits pension scheme more sustainable, which they advised in a green paper which was released earlier this year. The paper did spend time focusing on ensuring that any schemes must meet existing obligations, but it did not include how to ensure that defined benefit pension schemes remain open when it comes to future accruals.
More companies are focusing on changing or closing defined benefit schemes, but careful consideration must be paid to how it will affect employees in the long run before any final decisions be made.