June 28, 2012
Agreement for new Pension Solvency Funding Relief
Northern Transportation Company Limited
In June 2012, PSAC/UCTE Local X3040, other bargaining agents, non-unionized employees and pensioners from the Northern Transportation Company Limited (NTCL), passed an agreement for pension solvency funding relief.
This agreement will be forwarded to the Office of the Superintendent of Financial Institutions (OSFI) and the Federal Minister of Finance for final approval. It is scheduled to take effect on July 30, 2012.
It is the firstPension Plan Workout Scheme to be negotiated following the new provisions of the Federal Pension Benefits Standards Act and Regulations (PBSA), enforced under Bill C-9 (Budget Implementation Act).
This process was launched when the NTCL filed a declaration with the OSFI in 2011. It indicated no longer being in a position to remit special pension solvency payments, as required under the PBSA, without seriously impairing operational requirements.
A series of meetings were held between NTCL and bargaining agents representing all stakeholders to resolve the issue. They negotiated an agreement that would extend the time frame required to pay off the solvency shortfall from 5 years to 10 years.
PSAC/UCTE was represented by the legal firm Koskie, Minsky. This firm has extensive experience defending the interests of pension plan participants. They have assisted in a number of high profile cases including Nortel, Air Canada, NHL Players Association, Eaton’s and Dominion Stores.
It is hoped that this pension solvency funding relief agreement will serve as a model for other similar pension funding situations.
Date Modified : 2012/07/03