Key issues in the Defined Contribution Proposal
Unifor advocates defined benefit pensions for our members. The following proposal for a defined contribution (DC) plan is for workplaces where members do not have any pension plan, where the National Office has approved a DC plan, or where the bargaining committee wants to improve the DC plan already in place.
Typical Company Proposals
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Union Preferred Language
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Contributions |
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| 4.0% of straight time base wage up to 40 hours per week to a max of 1800 hours |
- The percentage of earnings or dollar value of company contributions should recognize the additional risk the member takes on with a defined contribution (DC) plan.
- If the company has a defined benefit (DB) plan, the company’s current service costs and solvency costs in the DB plan should be considered in setting the DC contributions.
- Set hours to 2080 per year (no weekly limit)
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| No contributions on overtime |
- Include OT at straight time rate
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| No employee contributions |
- Mandatory employee contributions with 100% or better employer match
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| Limits on contribution periods |
- Expand contribution periods to include hours paid but not worked (vacation, holiday, union etc) and periods of absence for disability, lay-off, pregnancy and parental leave
- Such periods can be voluntary for the member.
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| Administration |
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| Member pays all fees |
- Company pays administration fees, investment fees, and member education fees
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| Member must transfer funds out upon leaving |
- Upon termination or retirement, members will have option to leave funds in Plan, purchase an annuity, or convert funds to a LIF at preferential rate
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| Individual accounts |
- Pooled fund with professional investment team
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