Manitoba Telecom Services (MTS) has reached an agreement with its unions and retirees in respect of the implementation of the lawsuit regarding the administration of one of its pension plans.

For the past several months, the company and advisors have been working closely with its unions and retiree representatives to develop an implementation plan, which was unanimously agreed to by all parties.

The specific arrangements will be communicated to affected DB plan members in the coming weeks, and will be subject to court approval following a court hearing scheduled to occur on Nov. 3, 2014 as well as regulatory approval.

“We are pleased to have come to an arrangement that is equitable and fair that everyone has agreed to, and is now subject to the approval of the court,” says MTS CEO Pierre Blouin. “Going forward, we expect this matter to be resolved and there will be no more uncertainty in respect of our pension plan litigation.”

The settlement agreement provides that:

  • Total enhanced benefits available under the settlement will equal $140 million as of July 1, 2014. Thereafter the amount will grow at the rate of 2% per annum until court approval;
  • Of this amount, approximately $30 million will be paid in 2014 or early 2015, by the company directly to MTS employees who are members of its DB plan;
  • The remaining balance of approximately $110 million will be funded from MTS’ DB plan, and will be used to pay retirees and other persons with interests in the plan, and also pay expenses associated with the settlement. This amount will be funded by MTS over time and in accordance with federal statutory funding obligations.

“Today, we are all very pleased to announce that our hard work has resulted in the unanimous agreement and support of an implementation plan—one that is equitable and fair for everyone involved,” says a joint statement from unions and retirees.

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Copyright © 2017 Transcontinental Media G.P. Originally published on benefitscanada.com

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