National Irish Bank has agreed with its staff to introduce a hybrid pension agreement for new workers after a recommendation from the Labour Relations Commission.
The bank said that from August 1, it will close its existing defined benefit pension scheme to new employees and will replace it with a new hybrid pension plan for workers who join NIB from that date. Pension scheme arrangements for existing pensioners and employers are not affected by the change.
As part of the 'Sharing Success' agreement in 2007, National Irish Bank and the finance union agreed to a review of pension arrangements. The review, which started in January, was referred to an independent chairman, Kevin Foley of the Labour Relations Commission.
The recommendation also includes additional benefits for existing employees, including income protection and an extra day's leave in 2009.
The hybrid model comprises two elements - a cash balance plan and an investment account plan - and aims to deliver a pension of 64% of final salary as well as the state pension at the age of 65.
NIB's deputy CEO Kevin Gallen said the decision to close the defined benefit scheme reflects developments in the Irish financial services sector.
