One of the key reasons YUFA was able to conclude negotiations in October was that the Employer agreed to CPI-based indexing for the minimum guarantee portion of the York Pension Plan (YPP). The October 2018 settlement between YUFA and the Employer contains the following provision:
"The Employer is committed to improving the pension plan to provide for indexation of the minimum guarantee portion of pension based on the consumer price index (CPI). The parties will work with AUPC (All University Pension Committee) and, if necessary, with the joint pension committee under 14.01d, to formalize a detailed project plan to implement the improved indexation described above by no later than June 30, 2019."
Unfortunately, in a surprising reversal, the Employer has informed YUFA that, in the Employer's view, the words "minimum guarantee portion" refer solely to the difference between the member's money purchase pension and the member's minimum guarantee pension. The University's reinterpretation of the terms of the memorandum of settlement all but nullifies CPI indexing and thereby violates the agreement between the parties. For the typical member who retires on the minimum guarantee pension, the Employer's revision would result in almost no change from our current pension provisions since the amount eligible for CPI indexing would be negligible (as the difference between the minimum guarantee pension and money purchase pension is typically very small, or nil). For members who retire on the money purchase pension, there would be no indexed floor. In light of the Employer's action, YUFA filed a grievance on this issue on December 19, 2018.
YUFA is issuing this communication out of concern that members may make retirement decisions based on the expectation that adequate pension indexing for the minimum guarantee pension was secured in the last round of negotiations. While the Association considers the Employer's obligation to be clear, and intends to hold the Employer to that commitment, at this point, the Employer does not recognize its obligation to meaningfully improve pension indexing for the minimum guarantee.
In the meantime, YUFA is continuing to work on a without prejudice basis at AUPC with the other employee groups to improve our pensions, and will communicate proactively to keep members informed of developments on this important file.
For more information, please see these previous YUFA updates regarding pensions: