Westminster Savings Credit Union – Bargaining Update
November 10, 2017
To: MoveUP members at Westminster Savings Credit Union
This bulletin is a follow-up to our membership meeting held on November 2, and to respond to the employer’s most recent memo.
First, we want to thank everybody who attended the meeting. As we move ahead in this critical stage of the negotiations and work towards the best possible deal for you, it is imperative that you stay informed and continue to be aware of any misleading information that may be presented.
Our next scheduled session with the employer will be on November 24. We anticipate at this session that the employer will ask whether we will accept their proposal for a two-tiered pension system. Based on your input and feedback, we will NOT accept a proposal that features a two-tiered pension system.
We have listed some Q&As below that speak to our members’ concerns and why we will be taking this approach.
- The employer has guaranteed that, as a current employee, my Defined Benefit (DB) plan will remain in place. I need to look after my own, and my family’s, well-being first and foremost. Why would I reject this?
If all employees, current and future, have a DB plan, then yes, you will be able to count on monthly payments in retirement. However, if new employees are given a Defined Contribution (DC) plan, your DB plan could begin phasing out within five years.
Here’s why :
Future members of WSCU will eventually outnumber those who are on the DB plan. Our experts say this will occur within 5 to 10 years. When that happens, the majority may vote to end the DB plan during future contract negotiations.
- Why would the members, who are fighting so hard to preserve the DB plan now, vote to kill it at the next negotiation?
Currently 100 per cent of the members have the DB plan. However, under the employer’s two-tiered proposal, employees hired after July 1, 2018 will be in the DC plan.
As current employees (hired before July 1, 2018) under the DB plan move on or retire, the number of employees under the DC plan will grow to a point where they will eventually outnumber those under the DB plan. Our pension expert, Dave Porteous, believes that could happen as soon as 5 to 10 years from now, depending on how much WSCU grows. At that point, if the employer were to offer an incentive at a future negotiation in exchange for terminating the DB plan, there would not be a reason for those already under a DC plan to vote in favour of saving the DB plan because it would not affect them personally.
If that were to happen, the employer could easily go back on their “promise” by suggesting it is what the “members” want. Just as the potential pension benefits of your future colleagues rests in your hands at this moment, your actual pension benefits will rest in theirs in the future. If at that future point those colleagues see no benefit – or even a detriment – to preserving the DB plan because they are not under it, they will be in a position to vote against it and your benefits will be lost. That is what we mean when we say once the DB plan is gone, it is gone forever.
In our eyes, all members should be treated fairly and equally. A two-tiered pension would immediately cause a divide that will only grow as time goes on.
- The employer has stated that as long as I remain under a DB plan, I can receive a fixed monthly pension when I retire as opposed to taking a lump sum commuted value. Would that change for me if the employer transitioned to a DC plan?
The employer has stated that you can receive a fixed monthly pension as long as you live under the terms and conditions of the DB Plan. Once the DB plan is eliminated, you will no longer have this option.
- If it is beneficial for the employer to switch employees to a DC Plan, why have they not already done so at the non-union branches?
Although there is no impediment preventing the employer from unilaterally changing the terms of the pension plan for non-union employees, the reluctance to do so at this point may be to avoid providing incentive for those employees to seek unionization.
Knowing the value of having a DB plan, there would likely be a drive towards unionizing at other branches if they were aware that the union members were still benefiting from a DB plan. If the unionized branches were to lose their DB plan in one form or another, it becomes much easier for the employer to strip the DB plan from the non-unionized branches while taking away one of the incentives that they might have had to consider unionization.
- What can I do to help to support my fellow members?
Encourage them to understand all the facts about the DB plan and the DC plan. Encourage them to review the information that has been presented from both sides so that they can understand what is at stake. If you have colleagues or friends who work at non-unionized WCSU branches, make them aware of the ongoing negotiations and how it could affect them as well.
We have enjoyed a strong, cordial relationship with Westminster Savings Credit Union over the years and we remain committed to the negotiating process with them to craft an agreement that best serves the interests of our members both now and in the long run.