HEU members vote to accept changes to Municipal Pension Plan

HEU members have approved major changes to their union's main pension plan by ratifying a tentative agreement by 89 per cent. The vote was carried out from late October to mid November. HEU and the other public sector unions represented in the Municipal Pension Plan reached a tentative agreement with government and employers over the summer to move the plan from sole government control to one where employers and unions share control equally. It establishes financial improvements that will benefit both workers and employers in the future. This new structure is called joint trusteeship. All the parties recommended ratification to their members.

About 35,000 HEU members are covered by the Municipal Pension Plan. It also covers registered nurses, paramedical professionals and public sector workers including those working for municipalities and libraries, fire fighters, police and ambulance paramedics. In all, about 120,000 public sector workers, 30,000 current pensioners and more than 640 different employers are part of the municipal plan.

When all the ratification votes are finished, the Municipal Employees' Pension Committee will meet to formally ratify — or not — the tentative agreement. This is scheduled for November 23. Legislation is already in place, so once the plan is formally ratified, it will be in force.

Under joint trusteeship, plan members through their unions and employers, would share control of the plan and determine contribution rates, plan benefits, etc. Surpluses are shared and would be used to improve pension benefits, to reduce contribution rates by workers and employers, to strengthen indexing protection or to protect against future contribution increases.

Liabilities are shared, too, and there is the chance that premiums could rise in the future. But right now the plan is in good financial shape, and is being well-managed. Part of the negotiations provided for stabilization funds — a cushion of $1 billion to deal with future ups and downs. “This new arrangement will help us have greater control over our pension plan,” says HEU secretary-business manager Chris Allnutt.

HEU members who work in private, for-profit long-term care are not currently part of the municipal plan. Most community health workers aren't either, nor are community social services caregivers.

HEU has made headway in bargaining to achieve matching retirement savings plans (RSPs) for workers in these sectors. “But RSPs are still a far cry from a decent pension,” says Allnutt. “Having a decent income in retirement is a critical issue for HEU. That’s why it’s our bargaining goal to ensure that all members are covered under the Municipal Pension Plan.”