Unions threaten AA with strike action in pensions protest

The AA is facing an official strike ballot of its 1,400 insurance staff in a dispute over changes to the pension scheme.

Unions say a ballot of the group’s 5,000 staff – including AA Insurance Services – will take place over proposed changes to the defined benefit contribution scheme.

Independent Democratic Union national secretary Alistair Maclean said a strike could take place as early as May.

He said: “I think it is looking very much like there will be a strike. This is private equity at its worst. This is a highly profitable company that made over £360m last year and now they are coming along and saying we want a price to sell, so chop off pensions in a way that adds value to the business.”

Maclean said a union-organised ballot earlier this month, which involved three-quarters of staff, showed 99% were against the proposed changes.

However, AA president Edmund King said a 60-day consultation started last Friday and, once staff understood the proposed changes, he was confident they would come around.

King said the AA’s final-salary scheme offered a better deal than many other firms, by keeping it open for contribution from existing members.

The group had pumped £172m into pensions over the last five years, but still had a £190m deficit.

He said: “We think talk of a strike is premature and we think when they see the details, and talk to friends and other people, they will find that the AA pension proposals are far more generous [than other firms’].”

King said the company was not planning for a strike, but promised to maintain customer service if it went ahead.

Over-50s insurer Saga and the AA were merged in 2007 by private equity firms Charterhouse, CVC and Permira, in a £6bn deal.