August 13, 2010

An Important Message for BUFA Members

Pension Dispute Settlement

Recently, BUFA circulated a copy of a Press Release, issued on July 28, 2010, announcing that a settlement had been reached between BUFA and the Employer in the matter of the funding of the two pension improvements negotiated in 2008, and incorporated into the 2008-2011 Collective Agreement.

The purpose of this message is to apprise BUFA members of the substance and circumstances surrounding this settlement.

Most of you will recall that in 2008, BUFA succeeded in negotiating two pension improvements during our 17-day job action. These improvements were incorporated into the Collective Agreement in Appendix F. Article F.7.4(c), which came into effect on the date of the signing of the Agreement (Year 1), eliminated the then-existing penalty assessed against the spousal entitlement under the Mandatory Survivor Pension provision, and F.7.4 (d), which came into effect on April 1, 2009 (Year 2), increased the maximum pension amount to $1,975, per year of service.

F.7.4 (c) and F.7.4 (d) contain identical language in respect of the funding of these improvements:

The costs associated with the change shall be financed by the Employer through an increase in the Employer contribution levels under Article 4.1 and/or 4.2 of the Brandon University Retirement Plan text, in addition to those specified in F.7.3 above. The increased Employer contribution level shall be based on the cost of this improvement as recommended by the Plan actuary. The Employer will not finance this benefit through the use of actuarial surplus of the Plan.

In addition to these changes, BUFA negotiated Article F.7.4 (e), which increased BUFA members' contribution to the Plan by 0.5% of earnings. This change came into effect on April 1, 2009 (Year 2).

Shortly after Ratification, and following the Employer's decision to extend the two pension improvements to the other campus Unions and to the Exempt Staff (Administrators), a dispute between BUFA and the Employer emerged over the funding of the (Year 2) F.7.4 (d) improvement. This dispute was referred to Michael Werier for arbitration.

The question placed before the arbitrator was whether, according to the terms of the 2008-2011 Collective Agreement as negotiated, the University was required to solely fund the cost of the two pension improvements (BUFA's position), or whether the Employer was permitted to use the negotiated 0.5% increase in BUFA member pension Plan contributions towards funding these improvements (Employer's position).

For various reasons, the arbitration hearing, originally scheduled to commence in September, 2009, was postponed to the end of May, 2010 and then again to August 9, 2010.

On July 27, 2010, BUFA was approached by the Employer to discuss settlement. A brief (albeit intense) period of lawyer-mediated discussion between the Parties ensued, out of which a settlement was reached.

The full text of the settlement reads:

1. BUFA and the University are in agreement that the 0.5% increase in member contributions under article F.7.4(e) of the Collective Agreement is to be used to fund the cost of pension benefits and obligations generally, and not the specific cost of the two plan improvements in article F.7.4(c) and (d) of the Collective Agreement. These two improvements are to be financed as set out in articles F.7.4(c) and (d) of the Collective Agreement.
2. BUFA and the University agree that this settlement will be described as a good faith resolution of a disagreement between them as to the meaning of article F.7.4(c), (d) and (e) of the Collective Agreement, and will not be described as either a win or a loss for either party, or words to that effect.
3. The parties will notify the arbitrator that the dispute has been settled and that arbitration dates are accordingly being cancelled.

As indicated in our press release, BUFA is pleased that this matter has been resolved. As well, we are confident that the good faith manifested in this resolution will be reflected in, and can be carried forward into, the future.

In closing, I wish to express, on behalf of BUFA, our deepest appreciation to Bruce Forrest and Dennis Oleson, as well as to our lawyers, for their tireless efforts and steadfast resolve in relation to this file.

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For further information contact:
Joe Dolecki, BUFA President , 727-9749