TSTT/TELCO retiree goes to court for increased pension

A FORMER MANAGER at the Telecommunications Services (TSTT) and its predecessor, Telephone Company (TELCO), has taken the telecoms company and RBC Trust (TT) Ltd to court over the non-payment of increased pensions for retirees.

Ian Clarke’s lawsuit was filed in June, and he also seeks to be appointed the representative for the group of pensioners from the pensioners and deferred pensioners of the TSTT and TELCO plans, said to total some 1,500.

They are represented by Dr Claude Denbow, SC, Donna Denbow and Jerome Rajcoomar.

In an affidavit filed in support of the claim, Clarke said the majority of pensioners receive between $1,295 to $6,500 a month and have been no increases since 2009 despite the increase in the cost of living. Clarke also contends that although there are large disposable surpluses in both plans, TSTT has refused to increase pensions.

The lawsuit contends the pension fund plans, established in 1986 (TELCO) and 1993 (TSTT), actuarial valuations of the former, as of March 31, 2021, showed a surplus of $828,000,000 while the TSTT plan showed a disposable actuarial surplus of $356,000,000 at the same period.

The lawsuit argues that the retirees were the beneficiaries of the surplus in the TELCO plan while the TSTT plan provided for the augmentation of benefits for retirees.

It also said the plan allowed for discretional pension increases and required TSTT to act in good faith with its former employees.

The lawsuit contends TSTT’s contribution to the TELCO plan was 20.6 per cent but that was reduced to five per cent using the disposable surplus to reduce its contributions.

It said despite the reduction in contributions, there was no augmentation in pensioners’ pension payments.

It also said TSTT has used the actuarial surplus for its benefit since 2009 and ignored the position of the pensions and the failure to use any part of the surplus to augment pensions was a breach of its duty of good faith.

Clarke wants the court to determine if the failure by TSTT to augment retirees' pensions using the disposable surpluses from both plans and using it to reduce its contributions amounted to a breach of duty and destroyed the relationship of trust and confidence with their former workers.

He also wants the court to determine if TSTT’s position, outlined in a letter from its then-CEO in December 2021, that the augmentation of pension benefits was conditional on the Communication Workers’ Union agreeing to merge the plans was irrational, unreasonable and improper.

The court has also been asked to determine if RBC Trust, as trustee of the plans, was under a duty to raise with TSTT the question of whether benefits under the plans should have been increased because of the surpluses and the decreases in the purchasing power of the retirees for over a decade.