Steelworkers Reach Pension Sustainability Deals for University Employees

TORONTO, Sept. 29, 2014 /CNW/ - Groundbreaking agreements negotiated by United Steelworkers (USW) members at two Ontario universities provide a template for other public-sector employees to preserve defined-benefit pension plans, the union says.

"Defined-benefit pension plans that workers have negotiated and paid for over decades are under threat from employers and governments," says Marty Warren, the USW's Director for Ontario and Atlantic Canada.

"Our union and our members recognize that we have to be proactive to address this crucial issue," Warren says.

"We have come up with a forward-thinking approach that we think could be a model for other university employees and public-sector workers."

Pension sustainability was a key issue confronting more than 8,000 USW members as they negotiated new collective agreements this month at the University of Toronto and the University of Guelph.

The deals include a process to ensure long-term sustainability of their defined-benefit pension plans. The agreements envision a small increase in employee contributions and a greater role for workers in the governance of their pension plans.

"Over the last five years Ontario's Liberal government has increasingly pressured university employees and other public-sector workers to fund a greater share of their pension plans, while lowering employer contributions.  That's not a move to pension sustainability" notes Warren.

"Each Liberal budget since 2011 has set out the requirement for workers to move to increase pension contributions," he says.

The potentially precedent-setting deals negotiated by the USW began with a historic co-operation agreement between the Steelworkers and the University of Toronto Faculty Association (UTFA). The USW and UTFA decided to form a united front in their pension reform negotiations with the university.

The USW and UTFA represent the large majority of employees covered by the University of Toronto Pension Plan, which provides benefits to over 17,000 members, including 5,000 retirees. USW members also represent the large majority of members in the University of Guelph Hourly Pension Plan.

The new university agreements create joint working committees that will examine pension sustainability options and present reports by June 2017. In particular, the committees will consider creating Jointly Sponsored Pension Plans (JSPPs) - defined benefit plans in which employers and members share responsibility for plan governance and funding.

The existing pension system will continue over the next three years until the joint working committees at each university submit their respective reports. Proposed changes will have to be negotiated through the collective bargaining process and will have to be ratified by union members.

The USW believes this new approach could lead to the creation of a university sector-specific, multi-employer pension plan, covering other universities and their employees.

SOURCE: United Steelworkers (USW)