Canada Post union pushes for DB plans for all members

This article was originally published on Benefits Canada.

Sara Tatelman | March 6, 2017

In its latest round of negotiations with Canada Post, the Union of Postal Communications Employees, a division of the Public Service Alliance of Canada, is fighting for defined benefit pensions for all of its members.

“We believe that [defined contribution] does very little for the plan itself but has significant impact on our members’ retirement security,” says François Paradis, national president of UPCE, which represents engineers, human resources staff, call centre representatives and a variety of other employees at Canada Post. “. . . Our position is that instead of defined contribution, we should be permanently exempt from solvency funding.”

Employees who joined the organization after May 2014 are enrolled in a defined contribution plan, says Paradis. They can contribute from one per cent to four per cent of their salaries, to which Canada Post will contribute a match at between 75 and 125 per cent, depending on employees’ age and years of continuous service, according to a corporate newsletter. Between 100 and 200 workers represented by PSAC are on the defined contribution plan.

While the union conceded to having new employees join the defined contribution plan during its last round of bargaining in 2014, Paradis says it’s because the union was misled. “[As] part of those negotiations, we were told essentially by the corporation in bargaining that they would never get a special deal from the government of Canada.

“And shortly after stating that, they got temporary solvency relief from the government of Canada, which basically absolves them of making any form of solvency payments until January 2018. . . . And during that round of negotiations, our members were also told that if they didn’t accept this deal, they would probably get a deal of lesser value.”

In August 2016, a labour arbitrator ruled that new Canada Post employees represented by the Canadian Postmasters and Assistants Association would join a defined contribution plan. Nevertheless, Paradis is undaunted.

“What happened through CPAA is, I think, unfortunate but it doesn’t impact our strategy,” he says. “Our positions continues to be that we don’t see DC as the solution.”

According to a spokesperson from Canada Post, the organization is “not commenting on specifics related to negotiations other than we are committed to reaching a negotiated settlement that is fair to our employees while reflecting the challenges we face as a corporation.”

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