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“Canada Post has not moved on any of the issues,” said Palacek, national president of the Canadian Union of Postal Workers, which represents 50,000 members in both urban and rural units. “But we haven’t been told formally we will be locked out.”
“We can see where they are going. They are going to attempt to provoke us,” Palacek said. “We are telling our members not to take the bait, to stand strong. Our goal is to continue service to the public.”
He added that the union would pay out $ 200 a week in lockout pay to members from its strike fund. Its fund is in the “tens of millions,” and other unions have offered to help out if needed, Palacek added.
“In a competitive marketplace, the threat of a strike is just as damaging if not more damaging than an actual strike,” Hamilton said.
The company is promising to cover pay and prescription drugs – but other items including vacation, personal days and short-term disability coverage will be suspended.
At the heart of the battle is the company’s proposal to put future employees on a defined contribution pension plan, instead of the existing defined benefit pension plan, which is indexed for inflation. Two other unions and management have switched for new hires.
“It is fundamentally unjust to have people work side by side, getting wildly different compensation,” said Palacek.
Under a defined benefit pension, employers and employees contribute to a plan, and the worker is guaranteed a fixed payout at retirement, regardless of how pension investments performed or where interest rates stand.
The post office says the corporation is facing huge challenges with its pension plan with a $ 6.2 billion solvency deficit.
The union challenges that figure saying it is merely a number on paper if the pension is to be terminated, which is not happening. Instead, it notes the pension plan delivered a 7.3 per cent return in 2015, with a $ 1.2 billion surplus last year.
“When you start giving up the DB for new hires, you end up with a small, older group of employees in that plan, and a large number of retirees and the new hires don’t care about the DB plan,” she said.
In the Air Canada case, arbitrators chose Unifor’s proposal for a hybrid pension – a blend of both defined benefit and defined contribution plans.
“(Imagine) you are in a particular business. You are trying to run the business at a profit, which will make you as one of the leaders of the business get a bigger bonus, and will make the stock price higher,” said Thomas Levy, senior vice president and chief actuary of The Segal Group.
Back in the 1990s, companies were losing money making widgets but reporting profits because pension plans were so profitable. “Since 2001 when the tech bubble burst, it’s gone the other way,” Levy said.
Courier companies see boost in business as Canada Post work stoppage looms