Provincial Government Reaches Tentative Collective Agreements with CUPE
The Provincial Government announced it has reached tentative collective agreements with seven bargaining groups represented by the Canadian Union of Public Employees (CUPE). These agreements are for a term of four years, with just under two years remaining. These agreements will expire on March 31, 2020.
The Provincial Government and CUPE, which represents approximately 4,000 public sector employees, have reached agreements that include:
No wage increases.
Elimination of severance, which is an earned benefit that has been a financial liability for decades. Through its elimination, employees with at least one year of service will be paid one week to a maximum of 20 weeks.
Changes to group insurance for new employees. While current employees qualify for retirement benefits such as group health and life insurance after 10 years of service with a 50/50 employee/employer contribution, new hires will have to reach 15 years of service to qualify. Premiums at retirement will be calculated using a sliding scale based on years of service. The sliding scale starts at 85/15 employee/employer.
These collective agreements will support government’s balanced approach to fiscal management, maintaining services while creating a more affordable public service. The current projected savings of the severance payout overall is approximately $25 million per year. Severance is taxable income for the recipient and will also help stimulate spending at local businesses. Additionally, avoiding an increase in pay across the entire public service would avoid an increase of more than $40 million per one percent in wage spending annually.
Details around severance payouts for CUPE members will be announced in the coming weeks. Negotiations are ongoing with other public sector unions in the province.