Why is Carnival Terminating Retirement Benefits for its Employees?

Recently, a considerable number of Carnival Cruise Line employees have spoken out against the termination of retirement benefits for Crew Members. The company previously had a small benefit for employees who devoted several years of service to the Cruise Line, which was included in the contract they signed upon commencement of work.

These Crew Members recently received a memo from Carnival telling them that their retirement benefits were suspended. Considering it was what they had relied upon to continue working under the company, it's an obvious conclusion to say that they felt betrayed.

According to Carnival, only members protected by "government-mandated social programs" covered in the MLC 2006 (Maritime Labor Convention) are eligible for a retirement benefit. Carnival does not specify what programs they are referring to and may in fact only exist in a few countries. Needless to say, only a handful of Crew are part of these programs, leaving the vast majority without a retirement benefit.

In response to general negativity from Crew, Carnival have updated their website with "The Fun Ship Retirement Plan":

"To acknowledge and reward Team Carnival's significant contributions to The Company's success, and to help team members plan and save for retirement, Carnival has developed 'The Fun Ship Retirement Plan.'

This plan provides a lump-sum benefit upon team members' retirement from Carnival, provided they have at least 10 years of continuous service.

A prorated lump-sum benefit will be paid based on the individual's position within the company. The amount of the lump sum payment will be based on the last position held for the previous five years prior to the retirement date.

The longer a team member is employed beyond the initial 10-year period, the faster the benefits increase. Simply put, the longer you stay with Carnival, the larger your benefit payment will be upon your retirement."

This "lump sum" plan relies entirely on an individual Crew Member's participation and obviously cannot serve as a replacement for the original retirement benefit.

At the same time, Carnival itself is struggling with severe financial constraints after the fallout with public relations, following the debacle of the Triumph "Poop Cruise" back in February as well as an immediate string of mechanical failures and port stop cancellations.

However, the question remains: is Carnival Cruise Lines terminating the retirement benefits due to the aforementioned reasons, or simply slashing employee benefits to add to company profit?