Commission rules on shore pensions
• Shoreworkers have fought for years for a decent, guaranteed pension plan, a dream won through the 1989 strike and the recent IIC ruling.
By Jim Sinclair
It's not the plan the union wanted. It's not the best plan. But the new Shoreworkers' Pension Plan is a solid beginning towards ensuring that those who give their lives to the industry do not leave with empty pockets, facing their retirement years in poverty.
The struggle for pension plans began on the picket line in 1984 when workers held firm on demands for compensation for technological change. The result was the eventual setting up of a fund of 6 cents and then 8 cents per hour.
In 1988, the union negotiated the creation of the Pension Trust Fund and put 5 cents of the wage settlement into the fund, bringing the total to 13 cents per hour.
In 1990, the companies demanded the money be turned over to the company plans. The union demanded 15 cents per hour be put into the fund and a union controlled pension plan be set up.
Since 1989 the companies have not paid into the fund, awaiting the decision of the Industrial Inquiry Commission.
The union presented a carefully developed plan to the Commission. It described in detail the kind of pension the union was seeking and asked the Commission to rule that the companies should contribute 58 cents per straight time hour.
The Commissioner, Ken Mackenzie, rejected our proposal outright. He also rejected the companies' demand that money be placed in the corporate plan (which only a few belong to).
Instead, he designed his own plan for shoreworkers which
will form the basis of a new union administered pension plan.
The new plan will become effective Sept. 1, 1991. In his report, Mackenzie suggests that the delay was the result of companies' asking for a reprieve because of the economic problems they are facing.
"However, the companies ask for a delay in implementation, because of the very serious and unexpected losses they face this year," he said. "It is not only the increase itself, but the adverse impact on the morale of management and staff who are facing frozen compensation or cuts, that is the cause for apprehension."
This decision saved the companies an estimated $1 million this year.
Shoreworkers will automatically become part of the plan at when they reach 1,000 hours. The plan itself will be what is known as a money purchase plan with the employees contributing 3.5 percent of gross earnings and the company matching 3.5 percent of gross earnings. For the employee earning the 400 hour rate of $14.90 an hour, they will pay 52 cents into the plan. The company will match that money bringing the total contribution to an estimated $1.04 per hour.
A person who works 600 hours per year will have a pension fund of $624 at the end of the year plus interest. Those who work more and earn more will contribute more to their pension.
The plan will vest immediately, which means the company will match your money immediately and you will get the money directly into your pension fund. Each worker will have a different amount depend-
WORKI
• PENSIONS WERE HIGH on the agenda as shoreworkers mobilized for action on contract improvements and against company concessions before the 1989 strike.
ing on how much money they earn. This money is for a pension plan when you retire.
The actual rules of the plan and the by-laws will be drafted by the union, in consultation with our pension consultant.
Unfortunately, this plan does not allow the union to compensate for past service. The plan the union originally proposed did allow for this.
However, Mackenzie has ordered the revenues generated by the 13 cents per straight time hour to be paid immediately to the pension fund and to be divided amongst those employees who are 55 years of age and older. It will be divided according to the number of years you have in the industry. Someone with 20 years service will get twice the amount of a person with 10 years service. Exactly how this will be done will be determined when the plan is set up.
This will give those employees who will not have the time to work long enough to get a significant pension a bit of a benefit.
The companies are ordered to continue to pay this amount
into the pension fund on a regular basis and it will be distributed to those who qualify.
An employee who turns 55 in 1992 will share in the 13 cents for 1992 and in each subsequent year, but will not share in past revenues into the fund.
Mackenzie ordered that any changes to the plan must be approved by a two-thirds of the members of the plan attending a meeting. He also said the plan would be run by a minimum of three union trustees.
For shoreworkers, the plan represents a significant improvement. It includes employee contributions, which was not part of the plan as proposed by the union.
There will be many questions about the plan in the coming weeks. The union will move quickly to the develop the plan and answer all the outstanding questions.
The plan will be developed further over the years and together we can insure that shoreworkers receive the respect and the compensation they deserve for playing a crucial part in the in the health and well being of the industry.
-..anies rhrage cuts
ees and may impair the quality of worker that the companies need to attract to maintain their long-term competitive position." He agreed with the union that a two-tiered wage system would "divide shoreworkers into two groups with interests potentially at odds with each other."
The binding settlement includes a new compulsory pension plan to be set up before the end of 1991, through equal contributions from shore-workers and the companies amounting to 3.5 percent of earnings. This replaces a little-used voluntary pension Plan that had minimal company contributions.
Mackenzie agreed with the union demand for an increase to the Shoreworkers' Benefit Fund contributions, boosting the rate to six cents per hour from four cents. He states the Fund should be able to be self-sustaining and should be put in a position to allow a modest increase in benefits.
Shoreworkers made gains on some issues but they lost on others. The companies Were awarded concessions in work scheduling and in determining vacation pay.
The call-out minimum is
What Commissioner Ken Mackenzie said:
66A new salmon cannery relying on unprocessed B.C. salmon would not appear to be a very attractive investment on either side of the U.S./Canadian border.
66FPBA members have been alert to the threat of U.S. competition for some time. They all have aquired operations of one sort or another in southeast Alaska or Puget Sound, or both.
66Shoreworker wages and benefits are not out of line in comparison with wages and benefits in other resource industries and the cost of living.
{{Plant operations are characterized by increasing efficiency, much of it resulting from the introduction of new technology at the cost of thousands of shoreworkers jobs.
reduced to two hours pay from four hours, where a worker is sent home without work. There will be a "window" for scheduling a regular eight hour day shift without overtime pay, up to a quitting time of 6 p.m. Mackenzie also gave companies greater flexibility in scheduling overtime, a move that could cost some shoreworkers overtime earnings. The companies will be
allowed to bring in a small "start-up" crew at 6 a.m. without overtime, but Mackenzie makes it clear that this should not be tolerated if it happens on a routine basis.
A "vacation year" for determining the amount of vacation pay will be defined as 500 hours worked, including overtime hours. That is much longer than the 120 hour defi-
66It does not look like the comparative cost of processing exercises a significant influence on prices or that a reduction in shoreworker wages will greatly improve the companies' competitive position.
ttWhile the wave of technological change may have crested, its force is still flowing through the operations, and more job losses are likely to happen in the future.
66 The share of processing labour in the total cost of production has dropped to 13.5 percent from 16.5 percent in the early 1980s.
641 have concluded that the economics of the salmon and herring fisheries are fundamentally sound and both the harvesting and processing sectors should have a bright future.
nition the union wanted and will mean that the average shoreworker will have to work many years before moving up to a six percent vacation pay level. The companies had wanted a 1000 hour rule.
There will be no change to the wage rates negotiated in 1989. Mackenzie agreed with the union that current B.C. shoreworker wage rates are
reasonable given that the processing sector produces "full value for its margin and shore-workers have paid a price in jobs for the present level of productivity and efficiency."
He concludes by saying that the economics of the salmon and herring fisheries are "fundamentally sound" and predicts that both fishing and shore sectors "should have a bright future."
THE FISHERMAN / APRIL 22,1991 • 11