Finance
June 28, 2018

Provincial Government Reaches Tentative Collective Agreements with CUPE

The Provincial Government today 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 Honourable Tom Osborne Minister of Finance and President of Treasury Board and Minister Responsible for the Human Resources Secretariat will be available to speak to media regarding the collective agreements at 10:30 a.m. today outside the House of Assembly.

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.

Quote
“Our government continues to promote greater stability in the public service and economy. These agreements secure no wage increases, changes to group insurance for new employees and the elimination of severance, while providing a measure of job security to CUPE members over the term of the collective agreement. As a government, our priority remains balancing our fiscal situation while supporting the delivery of services and supporting economic development.”
Honourable Tom Osborne
Minister of Finance and President of Treasury Board
Minister Responsible for the Human Resources Secretariat

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Media contact
Marc Budgell
Finance/Human Resource Secretariat
709-729-2477, 689-0430
marcbudgell@gov.nl.ca

2018 06 28                                                    8:50 a.m.