A freeze on postal services starting July 2 is nearing reality as Canada Post and the Canadian Union of Postal Workers fail to agree on pension changes at the negotiating table.
Canada Post is proposing to replace CUPW members’ defined benefit pension plan with a defined contribution plan, says Mike Palecek, national president of the union that represents more than 51,000 workers in Canada. “There’s no way we’re accepting [pension changes],” he says.
“The pension is incredibly important for us, for our members who work for an entire lifetime at our public post office…with the promise that they’ll have a decent pension and be able to retire with dignity.”
The postal service says it will not comment on the specific changes it’s proposing for the union members’ pension plan, but Jon Hamilton, general manager of Canada Post’s communications strategy, says pensions are part of the negotiations.
“Our employees are well aware that there are challenges that the pension is facing…” says Hamilton. “…With the low interest rate environment plus the sheer size of the plan and the solvency deficit that currently exists… people living longer lives…certainly puts pressure on every single pension plan including Canada Post.”
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The organization closed its defined benefit pension to non-unionized employees and added a defined contribution component, effective Jan. 1, 2010. All defined benefit pension plan members on Dec. 31, 2009, remained in the plan. Negotiations led to the introduction of a defined contribution component for new unionized employees represented by the Public Service Alliance of Canada as of June 1, 2014, and the Association of Postal Officials of Canada as of March 1, 2015.
Canada Post dropped a similar proposal to introduce a defined contribution plan for new employees who were members of the CUPW amid a labour dispute in 2011, as Benefits Canada outlined in its April 2016 cover story.
“This is a line in the sand for us…we’re not accepting cuts from this employer when it’s making fantastic profits as a result of our work,” says Palecek. With negotiations set to conclude at the end of June, Palecek adds that “every indication is that Canada Post is preparing to lock us out in early July.”
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But, according to Hamilton, the company is doing everything it can to avoid a work disruption. “We’ve been negotiating since late last year. We have not made the progress that we had hoped we would make at this point, but there’s still time and we’re committed to using every minute, every hour to get an agreement.”
In order to come to that, Palecek says “Canada Post needs to come to the bargaining table with some serious proposals that we can actually accept.”
Last week, the union launched the National Organization of Retired Postal Workers, which is made up of 24,000 retired postal workers who joined the fight against proposed changes to the pension plan.