Tuesday, 19 May 2009

Court Rebuffs Forestry Giant

After tonight's General meeting, Steve Smith approached me with a newspaper clipping of the following article that he thought would be of interest to everyone. It is titled Court rebuffs forestry giant and the original can be found here. Here is what the article says:

Court rebuffs forestry giant

Insolvent AbitibiBowater Inc. must abide by its collective labour agreement and allow its unionized workers early retirement with full benefits, a Quebec Superior Court Judge ruled yesterday.

The Montreal-based forestry giant's decision to unilaterally suspend a new provision of the collective agreement that improved its workers' pension plan is "illegal," Justice Clement Gascon said in a ruling.

"This ruling sends a clear message that collective agreements must be respected" during bankruptcy protection proceedings, Gaetan Menard, an executive with the Communications, Energy and Paperworkers Union of Canada, said.

During contract negotiations, Abitibi-Consolidated, which in 2007 merged with Bowater, signed an agreement with the CEPU that would allow employees with 20 years of service to retire at age 57, instead of age 58, with full pension benefits. It also increased slightly the company's pension-plan contributions.

For their part, workers agreed to contribute another one-half per cent of their salary to the pension plan from May 1.

The company,under bankruptcy protection in the U.S. and Canada, is not appealing Gascon's ruling.

AbitibiBowater, which argued in court that it could not afford the cost of the new provisions as it seeks to restructure, had already begun taking those extra deductions from its employees, the court heard last week.

"The term double standard comes to mind," Gascon told the court while giving his reasons for the ruling.

About 200 Abitibi workers had informed the company they wanted to take early retirement, as early as May 1, the court had heard. On April 27, their union was informed by an e-mail that the company was suspending the pension improvements and those workers had the option of returning to work.

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