2006 was an exciting year with Pensions Simplification taking place from 6 April 2006, and Legal & General and the Trustees of the staff final salary pension schemes took this opportunity to make some changes to the current pension scheme rules. Additionally, it was decided that new employees would be able to join the Stakeholder Pension Scheme on their first day of employment rather than waiting for a year, as had previously been the case.
A significant communications exercise followed the Pensions Simplification changes, which included written correspondence, a web broadcast and face-to-face presentations at our sites throughout the UK.
Legal & General provides a dedicated in-house pension team which is on hand to offer support and information to members including pre-retirement seminars.
Amicus approached the Company with a request to collectively represent 1,236 first-level management employees. Previously, Amicus was able to represent members from this group of employees only on an individual basis. After a series of consultation meetings, the Company agreed that Amicus would represent this group of employees on a collective basis from 1 September 2006.
In the summer of 2006, Legal & General held a ballot to elect employees from its management population to collectively represent its middle and senior management employees. From September 2006, management has met with the representatives on a monthly basis to inform and consult with them on issues that affect the relevant management population.
We consulted with Amicus about the redundancy payment terms for staff grade employees, which resulted in improved terms for the majority of staff grade employees. We also agreed consistent processes in the event that any staff members are put at risk of redundancy, for example offering affected staff outplacement support.
Amicus and Legal & General continue to be members of the Dignity at Work Steering Group, a DTI/Amicus funded project aimed at preventing bullying in the workplace, on which Legal & General sits to share best practice. The 2006 Employee Satisfaction Survey included a question to find out whether employees considered their workplace to be free from bullying and harassment. 79% of responses were positive, a 1% improvement on the 2005 survey.
Thousands of our employees benefited from their participation in the Company’s 2003 Save as You Earn scheme, when their three-year savings scheme matured. These employees were allowed to exercise their options from 2 May 2006. The savings, accumulated from monthly amounts of between £5 and £250 per month, could be used to buy discounted Legal & General shares at just 55p each. The share price closed at £139.75 on 2 May and for those employees who had saved the maximum amount of £250 a month for 36 months, this gave them a gain of approximately £14,560. We are pleased that so many of our employees benefited from the success of the Company through their participation through the SAYE and other elements of our Employee Share Plan.
In consultation with Amicus, we successfully transferred employees in our Hove office to new premises in Hove. The employees have benefited from a modern and improved working environment and the office incorporates a range of energy-saving features (see Our Environment).
Our absenteeism rate due to sickness in 2006 was 3.9%, compared to 4% in 2005. This compares to the finance sector benchmark of 5.6% (source: Chartered Institute of Personnel and Development (CIPD)).
Our employee turnover in both 2005 and 2006 was 12.6%. This compared favourably with the finance sector average of 16.1% (source: CIPD).
Due to the closure of our motor insurance business in Birmingham and Ipswich, and closure of branches in Manchester and Warwick, together with a loss of a small number of jobs in certain business units as a result of a restructure, a total of 77 employees were made redundant in 2006. We successfully redeployed many of the staff affected and consulted with Amicus throughout the process.
“CSR is an increasingly important issue for staff, management, shareholders and customers across the world of work. Nationally and internationally, Amicus continues to work to ensure that organisations take account of CSR when making decisions that affect their staff and the wider community. Amicus believes that Legal & General performs well with regard to ethical behaviour and good employee relations when compared to many other companies operating in the Finance Sector.”
Andy Case, National Secretary, Finance Sector, Amicus
“This SAYE tranche will have me smiling all the way to the bank! I’m planning on buying a new car and finishing off some work to my recently purchased apartment.”
Diane McClean, Belfast