GO says court pension judgement could cost it €13m

GO plc said today that the total cost for implementing a pension scheme in terms of a Court of Appeal judgement given in July is expected to be in the region of €13.16 million.

The court had taken its decision following judicial proceedings filed in April 2002 against Maltacom p.l.c. (in 2007 renamed GO p.l.c.) by a number of former employees of Cable and Wireless Limited who became employees of Telemalta Corporation in 1975.

In 1998, Maltacom p.l.c. succeeded to all the rights and obligations of Telemalta.

"Following an analysis, the company estimates that the total cost for implementing the pension scheme in terms of the Court of Appeal judgement is expected to be in the region of €13.16 million," GO said in a statement.

"In view of the foregoing, the company will be adjusting the provision in the financial statements for the six month period ended 30th June 2008, to reflect the amount."

It said that the financial, technical and legal analysis of the interpretation and implementation of the judgement was still ongoing.

The former employees of Cable and Wireless Limited had argued that Telemalta had bound itself, by an agreement dated 1, January 1975, to create a pension scheme akin to that set up by the government, and that Telemalta/Maltacom had failed to implement the pension scheme. They had requested the court to fix a short peremptory period within which Maltacom should implement the pension scheme and which was to apply in relation to their wage and period of employment.

In its judgement, the Court of Appeal acceded to the requests and condemned Maltacom to implement the pension scheme vis-à-vis the plaintiffs within a period of three months from the date of the judgment and that such scheme should be considered to be brought into force from 1 January 1975.