queens university centre for law in the contemporary workplace pensions in a unionized workplace may...

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