Pension row: Tata Steel gets legal notice from British TUs

British trade unions have sent a legal notice to Tata Steel to ballot some 17,000 employees for a proposed industrial action over a pension row. The steel behemoth is on warpath with the country’s unions over suspension of the British steel pension scheme, against which the unions have decided to ballot its members for an industrial action from May 6, a day before Britain’s general elections.

“UK steel unions — Community, GMB, and UCATT — have given official legal notice to Tata Steel UK about their intention to ballot their members for industrial action in their ongoing dispute over pensions,” a statement by the unions said. It added, “The unions are urging their members to vote in favour of strike action and action short of strike.”

The company has proposed to replace the existing British Steel pension scheme with a ‘money purchase’ pension scheme, in which employees, the government and the employer will make definite contributions. However, the unions did not accept it on the ground that “it would bring more burden on the employees”. An industrial action ballot or vote is sought by unions to get a fix on majority view of their members about participating in the action -- strike, lock-out and action short of a strike.

A decision is then taken on the basis of results of the ballot. According to industry analysts, if the ballot goes in favour of the unions, this could be the largest strike in the British steel sector in 30 years. “Unfortunately, there is no sign of Tata showing any willingness to work in a collaborative and cooperative spirit and re-enter meaningful discussions with the trade unions about the future of the British Steel Pension Scheme (BSPS).”

“To defend the hard-earned pensions of our members, we have no choice but to ballot for industrial action,” Chair of the National Trade Union Steel Coordinating Committee Roy Rickhuss said. He added, “The unions were prepared to discuss changes that resolved the challenges faced by the scheme, but Tata rejected that constructive offer.”

The company plans to keep in abeyance the existing pension scheme, which is likely to hit 17,500 existing workers and over 90,000 pensioners. There have been reports that the suspension will help Tata save 1 billion pound. Negotiations between the trade unions and the company that started in November last year broke off without any agreement. 

Comments from Tata Steel could not be secured. A fourth union Unite is yet to give the legal notice to Tata, which the statement said is expected in the next few days. Tata Steel has invested 1.2 billion pound in its UK operations since acquiring Corus in 2007.