Bank workers brought into public welfare scheme

On 20 October 2010, the Portuguese government, the country’s federation of trade unions for the financial sector (FEBASE) and the Portuguese Banking Association (APB) agreed to bring about 40,000 banking employees into the General Social Security Scheme (RGSS) so they no longer need claim private parenting and retirement benefits. The largest union, SBSI, opposed the agreement, after initially supporting it, but FEBASE and two smaller unions, SBC and SBN backed it.


The banking sector used to have a large number of employees who were not automatically part of the General Social Security Scheme (RGSS). Their benefits came instead from employee and company pension schemes. Moreover, pension entitlements set by collective agreements in the banking industry have been generally more favourable than those provided by the RGSS.

Up until 2009, bank employees contributed 3% to 5% (depending on whether they were recruited before or after 1995) of their wage to the Family Allowance for Banking Employees (CAFEB) while the banks paid 11%. Family allowances and benefits to cover loss of wages through unemployment and occupational accidents and diseases were funded by CAFEB. The sickness allowance, death grant, parenting and survivor’s pension were paid by the banks. Retirement pensions were paid by the banks through the pension fund and in the amount defined through the collective agreements.

In 2007, the law reforming the social security system (Law No. 4/2007, article 102) set the goal of completely incorporating those occupational/professional groups that were only partially covered by the RGSS. The first step towards this was the tripartite agreement signed in November 2008 between the Ministry of Labour and Social Solidarity (MTSS), the Portuguese Banking Association (APB) and the three banking trade unions: the Banking Trade Union of the South and Islands (SBSI); the Banking Trade Union of the Centre (SBC); and the Banking Trade Union of the North (SBN).

According to the agreement, bank workers recruited after March 2009 would automatically be covered by the RGSS (Decree No. 54/2009), and contribute 11% of their pay to RGSS, plus another 1.5% to a Complementary Pension Plan. At the same time, the banks would contribute 23.75% to the RGSS and another 1.5% to the Complementary Pension Plan. These amounts are standard figures for RGSS contributions in the private sector. The retirement pensions for workers are bound by the rules of the RGSS, but can be supplemented, as per collective agreement, with additional payments from their own pension fund. However, for the majority of employees (those hired before 2009 and covered by CAFEB), this new system did not apply.

Movement towards agreement begins

The economic and financial crisis contributed to the increased concerns of banks and trade unions about pensions and social provisions in the banking sector for employees hired before 2 March 2009. The banks expressed concern about the sustainability of the pension funds in times of crisis. The unions feared the funds could be undermined or compromised by the crisis and felt integration into the RGSS would be a more secure solution. The government was concerned about the sustainability of the social security system. With the large public debt which would have to be balanced in the 2011 state budget, it felt new revenue for the RGSS pension funds would be more than welcome.

Negotiations to reach a deal on this issue began on 8 October 2010, between representatives of the trade unions in the banking sector (SBSI, SBC, SBN), the banks (APB) and the government. A tripartite framework agreement was reached, on 11 October 2010, on the integration into the RGSS of banking workers who entered employment before March 2009. It is estimated that around 40,000 workers will be affected, and that the RGSS will get an additional annual revenue of around €100 million in 2011.

There are three main changes envisaged by the agreement as outlined below.

  • The employees still pay a contribution of 3% to 5% (depending on whether they were recruited before or after 1995), but the contribution is now to the RGSS, not CAFEB. Employers stop paying 11% to CAFEB and start paying 23.61% to the RGSS.
  • Parental leave and retirement pensions will be paid by the RGSS. When the value of the old-age pension, calculated according to RGSS rules, is lower than the value set by the collective agreement, the bank will pay the difference through its pension fund.
  • Sickness payments and leave, disability and death-related grants and survivors’ pensions will remain the responsibility of the banks’ pension funds and employers.

General Council of SBSI votes against framework agreement

Delmiro Carreira, the President of SBSI, the largest trade union in the banking sector with 50,000 members, said that the framework agreement would be submitted for ratification to the relevant bank and trade union bodies. He explained that the general councils (CG) of the three main trade unions – SBSI, SBC and SBN – would meet to discuss and ratify the agreement. It was expected that this would happen quickly and that it would be possible to sign it during the week following the drawing up of the tripartite framework agreement. However, on 13 October 2010 the General Council of SBSI rejected the agreement, with 61 members against and 54 members, including the president of the union, voting in favour.

Those opposing felt there had been a lack of discussion among union members and employees about the content of the agreement. They were also concerned that the agreement might lead to employees’ rights, as defined by collective agreements, being undermined, if in the future the employers chose to withdraw from their present commitments.

Mr Carreira, who also coordinated the trade union group in the negotiations, then called a meeting of the Finance Sector Federation (FEBASE) to discuss the agreement (PT0711039I; PT1003049I). Mr Carreira declined to comment on the possibility of SBSI unilaterally blocking the agreement by its withdrawal. However, the Expresso newspaper reported another union source as saying that the SBSI’s rejection could undermine the agreement, as SBSI alone has more weight in the federation than SBN and SBC put together.

FEBASE signs second and final agreement with government, without SBSI

On 15 October, the banking sector committee within FEBASE met at Porto to discuss the agreement. It delegated the final decision to the FEBASE directorate on whether to ratify it.

On 20 October, FEBASE, the government and APB signed the agreement at the Ministry of Labour. The document was signed by Maria-Helena André, Minister of Labour and Social Solidarity, on behalf of the government; António de Sousa, President of APB, and João Mendes Rodrigues, Secretary General of APB, and some of FEBASE’s leaders, including Secretary General Carlos Silva and Deputy Secretaries Mário Mourão, Delmiro Carreira and Aníbal Ribeiro. FEBASE celebrated the conclusion of the agreement with representatives of SBN and SBC, but without its biggest member, SBSI. A tripartite commission will monitor the implementation of the agreement, including the impact of possible bank failures on pension funds. From January 2011, employers will increase the deductions from gross salaries from 11% to 23.6%.

Banking trade unions join general strike

In spite of the disagreement on the issue of integration into the RGSS, the three trade unions demonstrated unity by jointly denouncing the state’s budget proposal for 2011. The president of SBSI declared that the three trade unions SBSI, SBC, SBN, all members of the General Workers’ Union (UGT), would participate in the general strike of 24 November (PT1010019I), adding that ‘this is the first time the three unions join together in a general strike’. The reduction of wages and the freezing of promotion in publicly funded banking institutions are among the motivations for the general strike, along with increased taxes, which affect workers in most sectors.

Maria da Paz Campos Lima, Dinâmia

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