Terminated ArcelorMittal workers are up in arms as their pension plan is in jeopardy.
The workers stand to lose their pensions after it was discovered at a meeting on Thursday that the company had been delinquent in its payments to the plan.
According to the 2012 Actuary Report, which Sunday Guardian was privy to, the market value with accrual at March 31, 2013, for 2014 was $815,396,571.22
The executive summary states the company was supposed to have increased its pension plan contribution from six per cent to 12 per cent and by August 2016, increased to 23.7 per cent.
However, the company failed to do this and continued paying six per cent.
Sunday Guardian understands that a lump sum payment of $9 million was made in February towards the plan. It is unclear why this sum was paid or whether the sum had covered the total amount they had failed to pay over the years, but questions have been raised about the company’s motives since it closed down in March. Up to the end of March when workers received their final salaries, workers’ deductions had been made.
With moods starting to change, the union is warning that it can no longer keep calm and is anticipating that there will be unrest in this country.
The meeting, held between members of the Steel Workers Union of T&T (SWUTT) and the trustees of the pension plan, Republic Bank Ltd, along with the actuaries, raised questions about workers’ pensions, especially those who were encouraged by the company after its closure on March 11, to apply for their pension contribution reimbursement even though they had worked for more than five years.
However, the union said this was against the Trust Deed and Rules which govern the plan.
When the company closed its doors in March, 644 workers were sent home—206 had applied for early retirement and within the next 12 months, in excess of 100 would qualify for early retirement. Currently, there are close to 600 pensioners whose pensions range from $7,000 to $9,000.
Calls to ArcelorMittal’s managing director and CEO Robert Bellisle’s mobile went unanswered.
Questions were also emailed to Lisa Ann Joseph to be relayed to ArcelorMittal executives.
Finance Minister Colm Imbert did not answer calls to his mobile. Questions emailed to him were also not answered.
Trustees in the dark
At Thursday’s meeting, Sunday Guardian was told the trustees and the actuaries said they had not received communication from the company that it was heading into a liquidation and were not informed of the status of employees. They said the only information they received was through the union and media.
Explaining the pension reimbursement arrangement, SWUTT second vice-president Ramkumar Narinesingh said under the plan, workers who have five years or less service and who were terminated or resigned were entitled to get back their contributions.
He said those with five years or more service, under the age of 50 and who were terminated or resigned, had to wait to get a deferred pension.
“So you cannot get back your contribution after five years of service. The company has been telling workers that they could write a letter requesting their pension contributions even though they have more than five years service.”
But Narinesingh, who was present at Thursday’s meeting, said the trustees were very concerned, since under the rules, there was not a scenario where a member could simply get back contributions unless that person was migrating.
“Outside of that, you cannot get it back,” he said.
He added that failure by the com
pany to send the applications to the trustees in time, especially if a liquidation takes place, would result in workers not receiving any pension at all.
Also, he said, the company had not officially informed the union of its decisions.
After months of pressures with their jobs and now weeks of uneasiness over their monetary entitlements, workers were now in a hopeless situation, but Narinesingh said not even the word hopeless could sum up the workers’ feelings.
The situation had gone to a whole different realm, he said.
“The pension plan was the last hope for workers,” Narinesingh said.
His comrade, chief labour relations officer, Timothy Bailey said he was informed by sources that it was made clear that it would be a battle for the workers to get their pensions.
Bailey said the company was selling workers a dream.
Liquidation looms
Narinesingh said when the union asked the trustees about the status of the applications for the early retirement, “They told us they have had no such applications. Nothing was forwarded.”
With fear of liquidation looming over their heads, Narinesingh said, “What we understand is this—when this company is liquidated on the day that the liquidators announce, it is also the same day that automatically puts the pension plan in winding up status.”
He explained that the penalty for liquidating the investment from the plan prematurely could be around $300 million leaving the plan with about $500 million cash value.
He said after the plan is liquidated, the first step by the trustees would be to buy pension annuities from insurance companies to secure current pensioners. That’s a tender process that can take months. Those who have early retirement requests would be the first ones to be addressed. But without the letters from the company to the trustees, all seems lost, Narinesingh said.
Narinesingh and Bailey expressed the disappointment and hurt their members were feeling.
They said workers saw the pension as their last ounce of hope.
Narinesingh said, “We have an avenue where workers from 50 could take early retirement, minus ten per cent of their pension benefits, which is more or less two per cent per annum. At 55, you are guaranteed a full pension.”
He and Bailey, a ladleman and dispatcher, respectively, said they could not begin to imagine the sheer disappointment that workers over the age of 50 would feel since it is now more difficult for them to seek alternative employment.
Narinesingh: Govt has hands-off approach
According to an executive report to the Parliament in 1994 on the sale of Iscott to the Caribbean Ispat Ltd (CIL), 40 per cent of the shares of the company was supposed to be placed in the public domain.
It states, “CIL shall within three years after the completion date take all the necessary steps for the sale of 40 per cent of the shares of CIL on the Trinidad And Tobago Stock Exchange with the said issue giving preferential allotment and treatment to CIL’s employees and to the trustees of the ESOP for CIL’s employees.”
Narinesingh said, “This means that the current situation could have been avoided if previous governments had enforced this clause in the sale agreements.” He said for the past 15 years the union has been attempting to rectify this by engaging discussion from Ministers of Finance.
He said the union had numerous letters asking for government’s intervention for enforcement.
“Now the Government continues to have a hands-off approach, in that it is still unwilling to facilitate new investors which the union has sourced to ensure the future of the formers workers.”
The union wrote to the current administration but there has been no positive feedback.