Officers with the Grain Services Union have agreed to put a settlement over a years-old pension dispute with Viterra to a vote by affected employees in January.
Union officials and management of Canada’s biggest grain company, recently formed by the merger of Saskatchewan Wheat Pool (SWP) and Agricore United, have signed the settlement agreement, the company announced Friday.
Along with the vote by GSU members, the plan will still require approval from Viterra’s board of directors and also from the Office of the Superintendent of Financial Institutions of Canada, since the plan is registered under federal legislation, the company noted.
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The deal, if approved, would end a dispute between the union and SWP dating back to 2004 over how much the company and the plan members should pay to fund the plan’s “solvency deficiency,” which Viterra now estimates at about $19 million, down from $23.5 million at the end of 2006.
The SWP/GSU pension plan covers about 15 per cent of employees at the merged company, Viterra noted in a release.
The settlement calls for Viterra to move all active employees in the SWP/GSU plan to what’s called a “defined contribution” plan (a personalized RRSP-style plan funded by the company and employee, as opposed to a “defined benefit” plan that guarantees set levels of retirement income based on years of service) by July 2008 at the latest.
Viterra would take responsibility to fund pension benefits for plan members, with no change to what those members pay into the plan. The company would also pay $12 million toward the plan’s solvency deficiency, and make any future quarterly deficiency payments.
GSU officials, on the union’s web site, described those guarantees as a “major collective bargaining victory for all plan members.”
But the agreement also calls for Viterra to take over sole management of the plan and the risks associated with it. That would take the pension plan out of the GSU’s collective agreement with the company and end the joint trusteeship of the plan, which until now had been held jointly by SWP and GSU officials.
“In the proposed new environment, SWP/GSU plan members want to know what Viterra’s guarantees mean to them on a practical basis and how they would be affected in the event of a future plan wind-up,” said GSU chief Hugh Wagner in a statement.
GSU members’ meetings to hold the vote on Viterra’s offer are planned for the weeks of Jan. 7-11 and Jan. 14-18, the union said.
