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PSAC accepts deal — barely

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PSAC accepts deal — barely

Just over half vote to give up severance in trade for pay raise

By Kathryn May, The Ottawa Citizen December 2, 2010
Article Link

Members of Canada’s largest federal union gave lukewarm support to a highly controversial deal for public servants to give up severance pay as part of 5.3-per-cent wage increase over three years.

About 52 per cent of the 95,000 public servants affected by the deal, which the Public Service Alliance of Canada struck with Treasury Board nearly two months ago, turned out for the vote held in 329 meetings across Canada over the past month. Union members could only vote if they attended one of the meetings.

The most tepid endorsement came from clerical and administrative workers, who number more than 81,500. They voted 52 per cent in favour. The much smaller groups of operational workers and education and library workers voted 53.7 per cent and 60.4 per cent, respectively, in favour.

The big question is what impact PSAC’s endorsement will have on contract negotiations with the rest of the 18 federal unions, which refused to trade severance for a bigger wage increase.

Don Burns, vice-president of the Professional Institute of the Public Service of Canada, said he had hoped PSAC members would have rejected the deal because it “opens a hornet’s nest” for the rest of the public service.

“It’s obviously a divisive issue within PSAC and has divided the rest of the unions. No good will come out of this whole initiative and it has caused a lot of hard feelings,” said Burns.

PSAC President John Gordon acknowledged the union faced strong resistance to the surrender of severance pay.

“Let me state the obvious — this was a close vote … We heard from many of our members who are unsatisfied with the agreements — particularly the provision to cash out voluntary severance and end its future accumulation,” said Gordon.

Gordon insisted the fiery debate around the surrender of severance at the ratification meetings, community events and over email and social media was “healthy” and even strengthened the union. He said it drove home the message that “no future erosion of our members’ rights and benefits will be accepted.”

He said PSAC members are also the front-line workers who see the deterioration of programs and services from steady cuts.

“Our members work hard but they are unhappy with the treatment they are receiving from the Harper government,” he said.

In the lead-up to the vote, Twitter, Facebook and YouTube lit up in an unprecedented campaign to oppose the deal. Some say the narrow victory is a repudiation of PSAC leadership, which strongly backed the agreement.

The deal also created a deep rift among unions. Many accused the government of striking a deal with PSAC, the biggest and most militant union, and then imposing it on others — by legislation if necessary.

The deal will give the 95,000 workers a 5.3-per-cent increase over three years. About 0.75 per cent of that increase will offset the loss of severance pay for voluntary departures.

Existing employees will still get the severance pay they have accumulated during their working years, but it will be eliminated for new workers. Laid-off employees will still get severance pay and PSAC negotiated increased payments for them.

The deal also gives workers several options to cash out their severance pay. They can cash out their severance immediately at today’s rate of pay, keep it and cash out at retirement, or cash out some now and the rest later.

Gordon has argued that giving up severance pay was not a concession but a “tradeoff” to help minimize job losses. With an operating freeze, departments must absorb any increased costs, including raises.

The union negotiated a 1.5-per-cent raise in each of the next three years with a gradual phase-in of the 0.75 per cent to offset severance. Workers will get .25 per cent in 2011 and the remaining.50 per cent in 2013 after the freeze on operating budgets is lifted.

The agreement was reached during an unusual round of “expedited talks” initiated by Treasury Board before the PSAC contracts expired.

Not all PSAC workers who were offered the wage package during those talks accepted it. Nearly 20,000 technical and border services workers rejected it. These workers will now proceed in the normal round of collective bargaining that will begin in the new year.

But Gordon said the government is intent on eliminating severance pay for voluntary departures and it will be the key issue for all unions when they return to the bargaining table as their contracts expire.
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Obviously we have seen a shift in demographics amongst that union's membership.  The ones who want their money now (the Mcdonald's generation) , as opposed to when they retire and may need that extra cash to pay off a mortgage or other major loan.  Hope they have good financial advisors.  (Major opportunity for hoards of unscrupulous 'financial advisors' to prey on new victims.)
 
So it looks like we're getting a raise? PSACs raises normally give us a little bit of a financial boost.
 
I wonder how long before this will trickle over into the CF. Two, three years?

I mean losing the severance pay, not getting the raises.
 
Remember; PSAC is only one of the Public Civil Service unions.  There are two others, at least, and they have not ratified any similar deal, nor even put it on the table.
 
Obviously we have seen a shift in demographics amongst that union's membership.  The ones who want their money now (the Mcdonald's generation) , as opposed to when they retire and may need that extra cash to pay off a mortgage or other major loan.  Hope they have good financial advisors.  (Major opportunity for hoards of unscrupulous 'financial advisers' to prey on new victims.)

There is no shift of demographics yet, The majority of the operational trades withing the civil service (DND) are near retirement age. In our section about 60% are set to retire in the next 5 years. There was a big discussion and most have large severances coming to them already and would rather have the pay raise that would affect their pensions.

One other point that was discuss was a few years ago when the PSAC striked and was legislated back to work with little concessions. In this time of government fiscal restraint and roll backs. 5.5 % pay is a substantial increase on the front end. My plans are to sock it the 5.5 away into my retirement fund.


 
Grunt_031 said:
There is no shift of demographics yet, The majority of the operational trades withing the civil service (DND) are near retirement age. In our section about 60% are set to retire in the next 5 years. There was a big discussion and most have large severances coming to them already and would rather have the pay raise that would affect their pensions.

One other point that was discuss was a few years ago when the PSAC striked and was legislated back to work with little concessions. In this time of government fiscal restraint and roll backs. 5.5 % pay is a substantial increase on the front end. My plans are to sock it the 5.5 away into my retirement fund.

It's not 5.5% - it's 5.5% over three years.  The value of severance is estimated to be 0.75% of that.  Compare that to the severance pay value: 1 week per year, to a maximum of 30 years in a 35 year career is equal to 30 / (52*35), or 1.6% of pay.  The settlemnt provides less than half that amount.  It's a poor trade-off, but there's no surprise that PSAC looks after its senior folks and fails to protect the junior ones.


As mentioned earlier, the precedental value of this is important - I suspect TB will come to DND in the near term and look to cap off severance and the RFRG.  It would represent a one-time hit to the treasury, but would eliminate a significant long-term liability.
 
captloadie said:
I wonder how long before this will trickle over into the CF. Two, three years?

I mean losing the severance pay, not getting the raises.
From my reading above, only employees that voluntarily leave the government will loose severance.  If a parallel scheme were transfered to the regular force, only release items 4(a), 4(b) and 4(c) would be affected from the current CBI.

From CBI 204.40(3) the entitelment to severance is:
(a) Item 3(a), Item 3(b), Item 4(a), Item 4(b), Item 5(a), Item 5(b), Item 5(c), Item 5(d) or Item 5(e) of the table to QR&O 15.01 (Release of Officers and Non-commissioned Members) is entitled to severance pay in an amount calculated in accordance with paragraph (2);

(b) Item 4(c) of the table to QR&O 15.01, after having completed 10 or more years of continuous service, is entitled to severance pay in one-half of an amount calculated in accordance with paragraph (2); or

(c) Item 5(f) of the table to article 15.01 of the QR&O, after having completed

(i) ten years but less than 20 years of continuous service, is entitled to severance pay in one-half of an amount calculated in accordance with paragraph (2), or

(ii) twenty or more years of continuous service, is entitled to severance pay in an amount calculated in accordance with paragraph (2).
 
MCG

Just looking at your quote of CBI 204.40(3), the last few lines appear to indicate that this CBI will be updated, as they seem to reflect the old Terms of Service.

This may indicate future changes all around.  Some perhaps not for the best.
 
As a member of the bargaining unit mentioned here (PM), I can shed a bit of light on a few things:

-the raise is (IIRC) 2, 1.75, and 1.5 % over the 3 year deal. Not great when the standard number given for inflation is 2%/year.

The Severance buyout:

-currently, we have a severance package that pays on retirement, quit, fired, or layoff (basically any permanent seperation). As of the first day of this new deal, the only sev package that will continue to accumulate is the fired and layoff package. The quit and retirement one will still be there, but will not increase in dollar amount from that day forward. As with most severance packages, the amount you get is based on your salary upon leaving and number of years of service.

-we have a choice of three options with regards to the quit/retirement package:

1- take the full buy out. That is calculated as one weeks salary for each year of service. (It should be noted here that under the old contract, the quit package was 1/2 week's salary for every year, and the retirement package was 1 week for every year, so there's a bit of an incentive put in to the new deal).

2- take a partial buyout. The employee picks a dollar amount or percentage of the accumulated severance and takes that portion now, and the remainder on retirement/quit.

3- leave it there and take it all on retirement.

The only question left unanswered at this point is if I take a full or partial buyout of my quit/retirement severance package, and get laid off in a year, will I get the full layoff severance then, or just what has accumulated since the buyout.

There really is little incentive to keeping the quit/retirement package there and taking it on retirement/quit as it will acrue no interest.

What was most disappointing was the bargaining unit's transparency in taking care of the 'old guard' (literaly). They gained increases for bereavment leave but our annual leave remains pitifully low (3 weeks until year 8, 4 weeks at year 16, and 5 weeks at year 18). Of course the old guard doesn't care much about the halting of the retirement/quit severance package, they have pretty much maxed it out and it represents a very slight hit to them. Plus, now they can take the buy out and set up their retirement as they will still get thier full pension.

So I gave up 27 years of Severance pay accumulation (if I work until 35 years) and in return for this concession I received a salary increase below the cost of living increase, and 2 more days of bereavment leave.

Clearly I voted no.
 
You left out - old farts with more leave now are required to get first dibs on time slots for leave.  So bosses can't even use the scheduling of leave as a reward for good work - old slug wants those two weeks, old slug gets them.
 
dapaterson said:
You left out - old farts with more leave now are required to get first dibs on time slots for leave.  So bosses can't even use the scheduling of leave as a reward for good work - old slug wants those two weeks, old slug gets them.

Yup, forgot that one, wasn't that a nice little tidbit for the bluehairs?

Not much of an issue for me as I end up taking most of my annual in dribs and drabs to do kid stuff (Christmas concerts, field trips) and to recover from Rememberance Day and Mess Dinners.

 
Brutus said:
So I gave up 27 years of Severance pay accumulation (if I work until 35 years) and in return for this concession I received a salary increase below the cost of living increase, and 2 more days of bereavment leave.

Actually, you get no more bereavement leave.  It has gone from five calendar days (everyone would take a Monday to Friday) to seven calendar days (so you get a weekend as well).  The net impact?  Nothing.  But it gives the union a fig leaf to hide behind - "Look!  We got a concession!".

Next time I buy a car I want the seller to be a PSAC negotiator - I'll walk away with a new car and more money in my pocket than when I walked on to the lot.
 
dapaterson said:
Actually, you get no more bereavement leave.  It has gone from five calendar days (everyone would take a Monday to Friday) to seven calendar days (so you get a weekend as well).  The net impact?  Nothing.  But it gives the union a fig leaf to hide behind - "Look!  We got a concession!".

Next time I buy a car I want the seller to be a PSAC negotiator - I'll walk away with a new car and more money in my pocket than when I walked on to the lot.

I just learned that not 20 minutes ago when I went to the PSAC site.

Sooooo, I got a wage decrease (taking into account inflation), elimination of quit/retirement severance, and a more restrictive allocation of annual leave (what little I have).

I feel like I've been kicked in the P-SACk!
 
dapaterson said:
You left out - old farts with more leave now are required to get first dibs on time slots for leave.  So bosses can't even use the scheduling of leave as a reward for good work - old slug wants those two weeks, old slug gets them.
Yeah, as the junior peon in our unit, this pleases me to no end, too...
 
Great thing about unions is that they seem to be politiking themselves into obscurity....
 
Infanteer said:
Great thing about unions is that they seem to be politiking themselves into obscurity....
I agree whole-heartedly.

I haven't bothered with this thread until now, because quite frankly, I have no use for unions. It's been many decades since they had any utility in North America, and now they're just another burden on effective production.

I have a hard time seeing anyone in PSAC, UNDE, etc as an "oppressed worker," in need of a money-hoovering union executive to protect them from the man.


It's a rant, rather than an opening bid for discussion, so no response is required.
And before anyone decides to play 'Capt Obvious,' yes, I know the Treasury Board ties CF pay to the union-negotiated standard. I don't feel, financially, that I'm oppressed either.
 
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