« The transformation of Ghana's rail | Main | Thousands of migrants stranded after U.S. rail company pulls out of southern Mexico »

RMT wins guarantees on TfL ill-health pensions

RMT: August 15 2007

LONDON UNDERGROUND’S biggest union has won the guarantees it was seeking from companies covered by the Transport for London Pension Fund that no attempt will be made to undermine the pension rights of people forced to leave their jobs through ill-health.

RMT members last month voted by a 15-to-one margin to strike against moves that would dramatically affect qualification for ill-health pensions, but the principal employers have now confirmed that they will not attempt to alter the existing arrangements.

Ill-health pensions are granted to workers in the TfL fund whose ill-health makes them unfit to do their particular job. Proposed changes would have meant that anyone capable of earning an income, regardless of how small, would probably not qualify for or retain an ill-health pension. (see notes below).

"Our members showed with a massive majority that they were prepared to strike to defend their hard-won ill-health pension rights, and they have won a significant victory," RMT general secretary Bob Crow said today.

"We have now received the guarantees we were seeking that no attempt will be made to introduce cost-cutting changes that would deprive most people who leave work through ill-health of their pensions.

"We still believe that the fund rule that allows annual review of ill-health pensions should be scrapped, but we now have written confirmation that it will remain suspended.

"Our members have shown once more that collective strength can successfully defend pension rights when they come under attack," Bob Crow said.

ends

Notes to editors: In the ballot that closed on July 25, 3,141 (93.7 per cent) voted for strike action, and 212 (6.3 per cent) against. The employers involved were: London Underground, TfL, Metronet, Tubelines, Cubic Transportation, REW and EDF Energy.

TfL Pension Fund - Ill-health pensions now:

At present if medical evidence indicates that a member is unfit to do his or her own job, an ill-health pension would be granted. That pension is based upon length of fund membership, plus up to ten additional years' service. The pension may be suspended if the individual recovers to 100 per cent fitness, or revised to reflect an income. Where an income is earned, if the income plus TfL pension is greater than that of their previous job, the pension is reduced so that the individual's overall earnings are not greater.

What the proposed changes would have meant:

Ill-health pensions would have been split into two parts: a basic pension and an additional ill-health supplement. If the individual recovered, the ill-health supplement would have been withdrawn, which would mean that individuals under 50 (or 55 from 2010) would be unable to continue drawing their basic pension.

Crucially, the test for receiving an ill-health pension would have been changed to an 'all-work' test rather than the current 'own-job' test, which would left the majority of those leaving employment due to ill-health facing the prospect of their pension being stopped because they would not be totally incapacitated.

A train operator who developed eyesight problems, for example, would have been unable to continue in employment as a train operator but would not receive an ill-health pension under the proposed changes if he or she remained fit for some other form of work.

The employers had sought to exploit inconsistencies between the TfL Pension Fund Office's Guidelines on ill-health pensions and the existing Scheme Rules. However, the union has proposed that the Scheme rules be amended in line with the Fund Office Guidelines (which also reflect members' conditions of service), and that the current rule, 19 (5), which allows review of ill-health pensions, simply be abolished.