IBM looks to cut UK pensions liability

IBM accused of closing its UK pension scheme

The UK's biggest trade union Unite, has accused IT giant IBM of using the recession as a cover to cut its UK workforce's pensions, a move which could affect a quarter - up to 5,000 - of IBM's UK employees.

Unite said IBM would close its final salary pension scheme, to the detriment of long-serving staff.

"The company, like others in the IT sector, is using the cover of the financial crisis to erode future pension benefits for long serving and highly skilled people," said Peter Skyte, Unite national officer.

"This is a kick in the teeth to people in IBM who helped to rebuild the company when it was in difficulty, and demonstrates that company loyalty is too often regarded as a one way street in the corporate world of 2009."

IBM confirmed it will be launching a consultation on changes to its pensions provision from 5 August.

"IBM UK communicated to UK employees initiation of a consultation process regarding a package of pensions-related proposals. These proposals include enhancements to the defined contribution plan for all IBM UK employees, and closure of the defined benefit (DB) plans for existing DB members," said the company in a statement.

IBM's consultation process lasts 60 days during which employees can ask questions and send feedback on the proposals, after which a final decision will be made.