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Cineworld concedes higher pension contribution

24 June 2009

BECTU has persuaded Cineworld to pay more towards members' pensions during talks on the closure of the company's final salary pension scheme.

Members of the MGM final salary scheme, which closed to existing members at the end of May, will be able to secure an additional employer contribution of 2% of earnings if they pay at least 3% into the new defined contribution scheme.

The additional 2% payment was not part of the company's original planning.

The MGM pension scheme was closed to new members in 1997.

Whilst the new defined contribution scheme does not compare favourably to the final salary scheme, which attracted an employer's contribution of 15.9%, BECTU's talks with management have improved on the inital proposals.

As a result, the employer will match an employee's contribution, which is set at a maximum 5% and pay an additional 2% for previous members of the final salary scheme.

Assistant General Secretary Luke Crawley said:

“This is a significant victory. It is sad that Cineworld, like many other companies are closing their final salary scheme but we have used our position as the collective voice for union members to secure more money going into the replacement scheme. Without that union, voice the employer's cap would have been 5%.”

Despite the closure of the MGM scheme, the company will continue to pay £1.6million per year to repair the deficit.

Members who are deferred beneficiaries of the MGM scheme, and who remain employed by Cineworld until their retirement, will still receive a pension from the scheme linked to their final salary at the point of retirement.

 

 

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