Retroactive pay, pension, insurance increases in new agreement for postal workers
Canada Post Corp. employees and some retirees are receiving retroactive wage increases, as well as adjustments to their disability and life insurance and pensions, through two new collective agreements between the Canadian Union of Postal Workers and the crown corporation.
The agreements between Canada Post and its rural and suburban and urban postal service workers — represented by two separate bargaining units — will be in place until Dec. 31, 2021 and Jan. 31, 2022. respectively.
As part of the negotiations, arbitrator Elizabeth MacPherson awarded wage increases of two per cent for 2018, two per cent for 2019, 2.5 per cent for 2020 and 2.9 per cent for 2021. For rural and suburban postal workers, these wage increases are effective Jan. 1 of each year and Feb. 1 for urban workers. Recent retirees who still worked for Canada Post after the first bump are also entitled to receive retroactive pay increases.
Read: Arbitrator awards rural Canada Post carriers up to 25% raise in pay equity decision
“Canada Post would like to thank the arbitrator for her diligence and professionalism in working with both parties,” said the crown corporation in a press release. “We would also like to thank employees for their patience during this process.”
The wage increases will also generate a knock-on pension adjustment, said the CUPW in an update to members, since their highest-paid five years at Canada Post will become retroactively higher. Postal workers who retired after the first wage increase will receive an increase to their future monthly pension cheques, as well as retroactive increases dating back to their first pension cheque or deposit. However, increased pension premiums will also be deducted from each year’s retroactive payment. According to the union, Canada Post has indicated adjustments aren’t likely to be made before December 2020.
In an email to Benefits Canada, the CUPW’s negotiating committee noted the increase would be noticeable, but small. “For a person who retired on June 1, 2020, their income during their last five years of employment would have increased by about $4,500. Pension contributions would [have increased by] about $500. Their pension for the period and future indexed pension will increase by about 1.8 per cent per year or slightly over $500.”
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Similarly, members who went on long-term disability leave after the first retroactive wage increase will see a bump in their LTD payments to reflect their new salaries but increased premiums will be deducted from the retroactive payments.
Members will also benefit from increases to their life insurance to reflect the wage changes. An employee’s life insurance is based on two years of their salary until age 65, when it decreases by 10 per cent per year. If a member passed away after the wage increases took effect, Canada Post will pay the difference to their estate.
The CUPW wasn’t able to provide the number of members affected by the changes as the information is located in hard copy at its office, which is closed due to the pandemic.
Read: Canada Post and union agree to pay equity review
The arbitration decision also granted retiree health benefits for rural and suburban workers, with the eligibility period starting either Jan. 1, 2004 or when members first became employees. These workers will also be paid 75 per cent of their regular pay by Canada Post when they’re off work due to an on-duty injury after a successful worker’s compensation board claim. While waiting for a decision from the WCB, they’ll be paid 70 per cent of their regular pay.
It also committed Canada Post and the bargaining committees for both urban and rural and suburban workers to “have discussions with the objective of defining common ground and solutions that address the sustainability of the pension plan.”