Queens University Centre for Law in the Contemporary Workplace
Pensions in a Unionized WorkplaceMay 2014
Jo-Ann HannahDirector, Pensions and Benefits
”I encourage you to go on living if only to enrage your annuitants”
- Voltaire, French philosopher, 1750
The struggle in collective bargaining over DB pensions
Employer Concerns Costly Volatile funding Accounting rules
Employer Solutions DC for new hires DC for everyone
How the Union sees Defined Benefit
Historic fights for a decent pension plan
4.5 million workers still have DB plans
Peace of mind
Member has a known amount at retirement
Sponsor responsible for investing and funding the pension
Our employers have DB plans
Stewart converted Sun Life employees’ Defined Benefit (DB) to a Defined Contribution Plan
Donald Stewart’s annual DB pension is $650,000
Donald StewartRetired President & CEO Sun Life
DB delivers better value
• A Better Bang for the Buck– National Institute on Retirement Security, 2008
Pensions Support Communities
Pensions are 20% of earnings for some Ontario Communities
How do we keep DB plans?
• Support solvency funding relief• Benefit cuts – early retirement• Member contributions• DB lite for new hires• Hybrid pension – split the risk• No concessions policy
How do we keep DB plans?
Resistance is NOT Futile!
• Coca Cola• Hiram Walker• 3M• General Dynamics • Nav Canada• St. Stanislaus-St. Casimir’s
Polish Credit Union • Xstrata • NVI Mining • Rio Tinto Alcan • Detroit 3 • Air Canada
Recent negotiations where we kept DB
• Target benefit plans• DC plans • Negotiate beyond “insurers’ package”– Employer pays fees– Employer contribution rates must recognize “employee
risk”
When Push Comes to Shove
• Problems in retirement security down the road
• Lesser benefits for new hires– Tension in the workplace
Two issues on the DB to DC conversion . . .
Support the CLC expanded CPP
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