Correcting inaccurate information about the university’s pension plan and its management
One of the key negotiating issues in this round of bargaining with CUPE 233 has been contributions to the university's pension plan. The university believes in transparent disclosure about the pension plan and its management, and that all pension plan members should have accurate and up-to-date information.
Here’s a summary of what you’ll learn more about in this FAQ.
- Four of the five employee groups in the university’s pension plan, including its leadership, all contribute equally.
- Shared contribution language is included in CUPE 233 and OPSEU 596 collective agreements.
- CUPE 233 and OPSEU 596 collective agreements both outline shared equal contributions with the employer, as does the pension plan text.
- This means the university operated within the collective agreement when it increased employer and employee contributions by 0.4% for these union groups in January 2021.
- We agree with CUPE 233’s concerns about the inequities introduced by lower contribution rates for the Toronto Metropolitan Faculty Association.
- However, moving further away from shared contributions will destabilize the plan.
- We believe equal contributions by all participating groups ensures the pension plan remains strong and sustainable for the future.
- We believe that all employee groups should contribute equally.
- The university does not have a secret credit account and rejects any assertion that it does.
- A prior year credit balance (PYCB) is not a separate cash account or fund - it is an actuarial entry that is documented when a pension plan valuation report is filed.
- The unions are aware of the PYCB because of transparent disclosure of pension plan material shared with them by the university. Implying it’s a secret account is misleading and inaccurate.
- The university has not used the PYCB and has no intent to benefit from it at the expense of our employees.
- The unions have been aware of the possibility of required contribution increases since it was shared by the plan actuaries in 2018 through the Joint Pension Committee.
No. The CUPE 233 and OPSEU 596 collective agreements both clearly outline shared equal contributions with the employer. This is also outlined in the pension plan text.
The university operated within the collective agreement when it increased both employer and employee contributions by 0.4% for CUPE 233 and OPSEU 596 contributions, to satisfy the legally required increase. The same equal contribution principle was applied to non-union employees and leadership.
While the TFA’s collective agreement did not detail shared equal contribution rates, it is outlined in the plan text, and until an arbitration decision in April 2022, the TFA has always shared contributions equally with the university since the plan's inception in 1964.
It’s also important to note that four of the five employee groups in the university’s pension plan, including its leadership, all contribute equally.
No. The CUPE 233 collective agreement has included equal contribution language since at least 1990. There has been no change to this.
The grievance filed by the Toronto Metropolitan Faculty Association in response to the January 1, 2021 contribution increases was specific to its own contribution rates as outlined in their collective agreement. The decision did not impact or change the existing shared contribution language in CUPE 233 and OPSEU 596 collective agreements or contribution rates for these two unions. It also did not impact contribution rates for the university’s non-union employees and leadership, all of which continue to share contributions equally with the university.
The CUPE 233 and OPSEU 596 collective agreements both outline shared equal contributions with the employer and are separate and distinct from the university’s collective agreement with the TFA. The TFA collective agreement outlines specific contribution amounts.
Equal pension contributions by all employee groups benefit employees in the long-term, to ensure the pension plan remains strong and financially sustainable for the future.
The reality is that moving away from equal contributions could significantly destabilize the financial health of the pension plan and put employees’ pensions at risk.
It is not true that all other Ontario universities bargain their pension contribution rates. There are nine universities in Ontario of comparative size to TMU that have defined benefit pension plans.
- Six of the nine universities share equal contributions between employees and the university and do not bargain pension contribution rates. This includes TMU, with the exception of the Toronto Metropolitan Faculty Association.
- Two universities do not have equal contributions and bargain pension rates.
- One university does not have equal contributions and does not bargain pension contribution rates.
As shared previously, there are only three universities with defined benefit pension plans that do not share equal contributions with the university. All three of these universities have higher contribution rates for employees than TMU.
A prior year credit balance is not a separate cash account or fund - it is an actuarial entry that is documented when a pension plan valuation report is filed.
The university does not have a secret account and rejects any assertion that it does.
The last three valuation reports filed indicated a PYCB - this is not a secret. The university has shared materials that include the PYCB with the unions.
It’s important to note that the valuation report only reflects a snapshot in time.
Given the volatility of the market, the contribution rates have been maintained. The possibility of decreased contributions will be assessed in the context of future reports and the pension plan’s sustainability.
No. The university has not used the PYCB and has no intent to benefit from it at the expense of our employees.
TMU has a Joint Pension Committee (JPC) with representatives from each employee group that participates in the pension plan.
The plan actuaries first informed the members of the JPC of the possibility of required contribution increases in 2018. There were six meetings between 2019 and 2020 where this was discussed. The valuation was then filed in January 2020.
The university is committed to keeping its unions fully informed and consulted during pension decisions.