Process

We divide the description of the process into four phases.

OCUFA-COU talks

In 2010, Ontario Budget laid out an expectation for joint sponsorship, and no otherwise relief from solvency valuations/payments. Around the same time, the first meetings started between and within the Ontario Council of University Faculty Associations (OCUFA) as representing the employees and the Council of Ontario Universities (COU) as the representative of the universities.

In 2012, OCUFA and COU applied and received grants from the Ontario Ministry of Finance to create a jointly sponsored plan for Ontario universities (see 3↑ and OCUFA pension review) . Initially, the idea was to create one plan for all Ontario universities. In order to encourage the participation of the largest of Ontario universities, the UofT, the benefit part of the plan and its expected cost was designed to be as similar to our current plan as possible. These talks reached an impasse last year, mostly because of the issue of the representation of the non-unionized staff on the sponsor board.

Current situation

UTFA Council holds special meetings devoted to pensions: March 9, March 21 (1 hour of regularly scheduled meeting), and March 28. THese meetings are restricted to the Council members.

The UTFA Annual General meeting on Thursday April 6, 2017, 3:30–6:00 p.m. (Inis Town Hall, 2 Sussex Ave.) will feature panel on pensions.

Ratification

The conversion of single-employer plan to a new jointly sponsored plan requires consent of the members. (The general rules come from Ontario Pension Benefit Act (section 80.4) and specific from regulation 311/15). It is required that

    • at least 2/3 of the current members agree to the conversion, and

    • no more than 1/3 of retired members and other persons entitled to benefits object.

The consent does not require a vote of individual members. The law says that it is enough for the trade union that represents them to give their approval. It is understood that UTFA is going to be considered as a trade union.

UTFA is going to decide how it will give its consent in the name of its representatives. There are various options considered, including a vote by Council, and a ratification process with all members .If the latter, UTFA may decide to use a threshold higher than 50% for the vote.

Note that the 2/3 of the vote threshold described above applies only to the whole University. Once each of the units decides in their own way, their votes will be counted as a block and applied towards the 2/.3 criterium. If you wonder who holds the numbers in this vote, here is a decomposition of the current plan members according to their union representative.

In particular, none of the unions is strong enough to give consent on its own. Although it is theoretically possible that there will be enough consent to overrule the decision of faculty, given the numbers of non-organized members, it seems unlikely.

It is important to know that once (and if) there is a vote, the vote will be FOR or AGAINST the proposal. You will not be able to vote for or against particular elements of the plan. If you like or dislike a particular feature of the plan, the right time to act is NOW: reach out, come to townhalls, speak!

The law has other important regulations about the consent process. In particular, before the consent is granted, the members will have to be informed about four ways in which their pension situation under a jointly sponsored plan might worsen relative to their current plan (PBA, 80.4 (4)). These are

    • the fact that under jointly sponsored plan the employers and employees share the responsibility for paying back any potential deficit (either evaluated through going concern or solvency). In particular, the members might be required to raise their contributions to cover the deficits for the liabilities that accrued under the old plan (see transfer of the old plan liabilities)

    • the fact that if the plan were to be wound-up, the amount or commuted value of a pension benefit, a deferred pension or an ancillary benefit may be reduced (see reduced pension security).

    • the fact that pension benefits provided by jointly sponsored pension plans are not guaranteed by the Guarantee Fund, and

    • the fact that, if the jointly sponsored pension plan elects to do so, the members will be excluded from grow-in benefits. (TBA)

Transition

    • How will the transition look from my perspective? What will I see?

    • How will the new plan keep the promises of the old plan?