The Court of appeal rejects the request of the pensioners of Paper White Birch, calling for damages to their former trade union after the termination of their pension plan.
May 20, 2020 18h33
A wish of the Court of appeal for the retirement plans
The Court of appeal rejects the request of the pensioners of Paper White Birch, calling for damages to their former trade union after the termination of their pension plan. The highest court in Quebec took the opportunity to wish of “binding measures” in order to avoid the repetition of such tragedies for thousands of workers.
The collection of approximately 400 retired workers of the factory of pulp and paper Stadacona property of White Birch, considered to have made the charge of the relaunch of the company and to have been sacrificed during negotiations by the union Uniforms in 2012.
The superior Court dismissed the application for damages on the part of retirees in may 2018. The judge of first instance has made some of the blame for the union, including not having consulted or informed the pensioners of the final proposal of the employer, which provided for the termination of pension plans heavily into deficit.
Judge Jean-François Émond of the superior Court, however, concluded to the absence of a causal link between the faults of the union and the damages claimed, amounting to $75 million.
“Consequences to be disturbing”
In a judgment rendered Wednesday, the Court of appeal dismissed the appeal; it is no fault of Uniforms and equipment, which is in compliance with the mandate obtained from local authorities.
The judgment, however, is rich in observations on the problem of the deficits of the pension plans in the event of bankruptcy.
In the eyes of the Court of appeal, the cause of retired White Birch is a “striking illustration” of the “limits of the protection of acquired rights of retired employees when their interest is opposed to that of active workers forced to review their collective agreement in the context of a financial reorganization of the company,” wrote judge Guy Gagnon, on behalf of his colleagues Lorne Giroux and Julie Dutil.
The judge Gagnon is not optimistic for the future. “Unfortunately, I must conclude that, in the absence of adequate measures of nature to better protect the rights of members of the first group (retirees), the laws of the market, if left to themselves, may cause consequences to be disturbing,” says the judge Gagnon.
In conclusion of the judgment, the judge of the Court of appeal can be used to express a wish.
“I don’t know if the Regulations on the supplementary pension schemes and with the ministerial decree of 6 December 2019 adopted under this regulation, or any other applicable laws, have helped to stabilize the defined benefit plans, such as those in question, begins the judge Gagnon. But, in the light of important consequences on the lives of retired employees that results in a capitalization lack of these plans in the event of failure of the employer, we can only wish for the implementation of mandatory measures to protect the sustainability of these plans. I say no more, well aware of the exclusive rights of the legislature in this area.”
Petition to revise the law
A petition, online until may 21 on the website of the national Assembly, calls for a revision of the legislation on the administration of the pension plans. It is carried in particular by the retired employees of newspapers of the deceased Group capital cities Media, and calls for the establishment of a program of insurance, to the expense of the enterprises, to compensate for any possible cuts in pension benefits, similar to what is done in Ontario. A little more than 10 000 people have signed since February.