Retiree benefit changes sell out future generations of Ontario’s public servants

‘Bad deal’ establishes a two-tier system that will worsen generational inequality

Members will recall that the OPS Employer announced in 2014 that anyone retiring under the Public Service Pension Plan after January 1, 2017 would be required to pay 50% of the cost of the premium for post-retirement benefits, such as vision care, prescriptions, and dental care. Those in receipt of a pension before 2017 would continue to have 100% of the premium paid by the Employer.

To add insult to injury, the Employer also maintained that enrollment in the post-retirement benefits plan would be compulsory—retirees would not be permitted to opt out of the benefits, even if they had other coverage or did not want it, and would be forced to co-pay the premium.  AMAPCEO intervened to object and successfully pressured the OPS Employer to back down on their attempt to make the post-retirement benefit premium mandatory.

Flash forward to November 16, 2016, when the OPS Employer announced further changes to post-retirement benefits following negotiations with another bargaining agent (OPSEU) over benefits for members participating in the OPSEU Pension Trust, which is co-sponsored by both OPSEU and the Government of Ontario.  The Employer is unilaterally applying the OP Trust changes to AMAPCEO members (and all other OPS employees) who participate in the PSPP (which, unlike the OP Trust, is solely sponsored by the government), with the following results:

• Current OPS employees (hired by December 31, 2016) will now have two options when they retire:  (a) enrol in the current benefits plan and co-pay 50% of the premium, as announced in 2014, or (b) accept a new inferior benefits plan that offers less coverage, with more restrictions, than the current plan, but with the premium 100% paid by the Employer.

• Future OPS employees (hired after December 31, 2016), however, will only be eligible for the inferior benefits plan when they retire. Further—this next generation of public servants will bear the full cost (100%) of the premium.  The Employer has labelled this scheme the ‘Retiree Focused Plan’.

AMAPCEO President Dave Bulmer recently wrote to Treasury Board Assistant Deputy Minister Marc Rondeau with our union’s major concerns with this latest announcement, which are:

1. It establishes an unfair two-tier system and sells out future generations of public servants

   This new ‘Retiree Focused Plan’ scheme establishes a second, lesser tier of benefits for workers hired in 2017 or later—a recipe for fostering animosity in the workplace and decreasing the competitiveness of the OPS as an employer. It worsens the generational inequality that the Employer claims to care so much about.

   Not only is it unacceptable that the Employer would move to find cost savings on the backs of a new generation of public servants, but this new ‘Retiree Focused Plan’ appears to be cost-neutral to the Employer—leaving no sound fiscal rationale that justifies eliminating retiree benefits for new employees.

2. It includes sweeping cuts to retirees’ benefits

   The new ‘Retiree Focused Plan’ is anything but, with partial or total reductions for vision care, orthopaedic shoes, wheelchair and ambulance services, dentures, and private-duty nursing—some of the benefits that retirees rely on and value most. Under this new plan, these benefits are even further out of reach. 

Given these concerns, AMAPCEO is demanding that the OPS Employer reverse these changes to restore post-retirement benefits for AMAPCEO members hired in 2017 or later, and that they ‘show their work’ by disclosing any studies, reviews, or other analysis they used to arrive at this decision.

AMAPCEO members—and indeed, all public servants—work hard to provide quality services to the people of Ontario. Selling out future generations of those workers is the wrong thing to do.