Manitoba Telecom Services Inc. (MTS) reached an agreement with its unions and retirees for the implementation of the lawsuit regarding the administration of one of the company’s pension plans. The plan was the subject of a decision of a Supreme Court of Canada ruling on Jan. 30, 2014.
The agreement provides that the total enhanced benefits available under the settlement will equal $140 million as of July 1, 2014. The amount will grow at the rate of two per cent per annum thereafter until court approval. In 2014 or early 2015 the company will pay approximately $30 million of this figure directly to MTS employees who are members of its defined benefit pension plan.
The remaining balance will be funded from the company’s defined benefit pension plan and will be used to pay retirees and expenses associated with the settlement.
MTS has been working with its unions and retiree representatives for the past several months to develop the implementation plan unanimously accepted by all parties. The specifics of the agreement will be subject to court approval following a hearing scheduled on Nov. 3, 2013 as well as regulatory approval.
“We are pleased to have come to an arrangement that is equitable and fair that everyone has agreed to, and is now subject to the approval of the court,” said Pierre Blouin, CEO of MTS. “Going forward, we expect this matter to be resolved and there will be no more uncertainty in respect of our pension plan litigation.”
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