March 25, 1997

TO: All MUFA Members on the CP/M Scheme

FROM: B. E. Lynn, Remunerations Chair

RE: Joint Committee Remunerations Agreement for July 1, 1997 to June 30, 1999

Before looking at the details of the Agreement, however, it would be well to review the principles that underlay MUFA's negotiations. First, we argued that we required that there be a restoration of CP/M awards for 1994 and 1995 and that awards for the 1996 and 1997 years be at the normal CP/M value of 120 par units per 100 faculty members. Second, we contended that there had to be some component of scale increase in any agreement. Third, we felt that if the timing of any increases were delayed to accommodate the Administration's budgetary needs, that those increases had to be included in the nominal pensionable salary (explained below) of individuals so as not to disadvantage those nearing retirement. Finally, we were firmly committed to reducing and eventually eliminating the unpaid days faculty were required to take. These principles guided the negotiations and I believe that the agreement we reached is in line with these principles. An explanation of some of the details follows below.

1. The nominal salary which includes all of the increases to which the faculty member is entitled and is used to determine the best average salary (BAS) for pension purposes.

2. The actual salary paid which is the gross take-home pay of the faculty member.

With respect to CP/M it should be noted that while the full value of CP/M awards are included in nominal salary from July 1 of the respective salary year, in year 1, faculty will receive payment for only 50% of the value of their 1996 awards and in year 2, they will receive payment for 50% of their 1997 awards. We agreed to make no claims for retroactive payments of the six months of CP/M lost, nor did we claim any retroactive amounts on the 1994 and 1995 restoration amounts.

ONE-TIME PAYMENTS AND ATB. The Administration was reluctant to negotiate an across-the-board increase and in their original position offered only CP/M adjustments. In the final position, the MUFA team decided to trade off its demands for across-the-board salary increases for one-time payments of 0.5% of salary on July 1, 1997 and July 1, 1998. These one-time payments are to be based on the nominal salary of the faculty member and not on the reduced actual salary base.

FOR EXAMPLE, a faculty member with a nominal salary of $80,000 will receive a one-time payment of $400 (0.5% x $80,000) in the July take-home pay. For 1997/98 the salary base for this calculation will be the July 1, 1997 nominal salary with no reduction for the two unpaid days. In 1998/99, the salary base (nominal) for the one-time payment will include the 1996 CP/M award as well as the 1994 and 1995 restoration.

Towards the end of the Agreement (May 1, 1999), faculty salaries will be increased by 1% across-the- board.

CP/M RESTORATION FOR 1994 AND 1995. As has been mentioned, the unpaid portions of the CP/M awards for 1994 and 1995 will be paid on January 1, 1999 and included in nominal salary from July 1, 1997. The amounts involved are 30/110 for 1994 and 55/110 for 1995. You will recall from your salary letter last year (and those issued during the Social Contract) that the value of the award paid was 110/120 (11/12) of the normal par value of $2,155.66 or $1,976. At par, the value of the restoration is thus: 85/110 x $1976 = $1526.93 (in the first salary range); $1,145.20 (in the second salary range); $763.47 (in the third salary range); and $381.73 (in the fourth salary range). On an average salary of $80,000 (which is in the second salary range on the CP/M profile), this represents $1145.20/$80,000 or about 1.4% of salary.

RETURN TO NORMAL PAR VALUES AND ADJUSTMENT OF THE CP/M PROFILE. In each of the years of the Agreement, the CP/M awards will be calculated as 120 par units per 100 faculty members which represents a return to normal CP/M awards. As well, the CP/M profile will be adjusted in each year by the previous December to December CPI (for 1997, this is 2.2%) plus 1% (representing a token catch-up for lost adjustments over the Social Contract). This indexing of base salaries and the CP/M profile will have a twofold effect:

1. the par value will increase by this amount;

2. the breakpoints on the CP/M profile will be adjusted upward so that individual faculty will remain longer in their current segments of the profile.

The assumed adjustment for 1997/98 and 1998/99 par values are as follows:

PENSION HOLIDAYS. We have agreed to pension holidays of 50% of member contributions for each of the two years of the salary agreement. Currently our pension contributions constitute 3.5% of salary up to the yearly maximum pensionable earnings for CPP ($35,800) and 5% of earnings thereafter. On an $80,000 salary that would be

It should be noted that the increase in take-home pay which arises from the two-year pension holiday represents a temporary increase in take-home pay.

UNPAID DAYS. The MUFA negotiating team was opposed to the idea of "unpaid" days from the outset and one of our objectives was to eliminate them altogether. We felt that we have done the best that we could in reducing the unpaid days from the three we were subjected to in 1996/97 to two in 1997/98 and none in 1998/99. For faculty members, this means that 0.4% of salary will be restored in 1997/98 and the other 0.8% will be restored in 1998/99.

PDA AND PDA SUPPLEMENT FOR RESEARCH LEAVES. The agreement increases the amount of PDA by $100 as of the start of the 1997/98 budget year (May 1, 1997). As well, the Administration has agreed to allow us to borrow and to carry forward two years of PDA. This effectively allows faculty members to accumulate PDA to be used for research leaves, equipment purchases and other items. The extending of carry-forward to two years and allowing borrowing as a routine matter makes the use of the PDA much more flexible.

The PDA supplement for research leaves represents an attempt to increase the funding available from University to support faculty research initiatives. For full-year leaves this is approximately $500 more (tax free) money than we currently receive for research purposes and about $250 more for half-year leaves.

MUFF FUNDS FOR RESEARCH. In the Remunerations Brief for 1997/98, we suggested that a research fund for seed grants and equipment replacement be established. While no agreement was reached on this proposal, a more general suggestion that the Administration and MUFA make a joint proposal to the MUFF Committee for funds to support research for individual faculty members was agreed to. Discussions about the way in which this will be done will be ongoing in the Joint Committee. It should be understood that this proposal will be only one of a number of proposals for use of the MUFF funds.

BENEFITS. The Agreement reached in the Joint Committee brings closure to a number of benefits which were under revision during 1996/97.

1. Medical and Dental Coverage has been extended to 1 year (gratis) for families of deceased faculty and offered for an additional 4 years at the average cost of the plan.

2. The Pregnancy/Parental Paternity Leave was adjusted to accommodate for legal changes which have occurred since the policy was previously negotiated. The major change was in the area of parental leave for adoptive parents. In line with current EI legislation, we have agreed to a 14-week support period. The case of discrimination against adoptive parents in the EI policy is currently before the courts and the McMaster policy we negotiated allows us to change our policy should the Federal rules change.

3. Tuition Waiver/Bursary. From our mail survey of MUFA members, which elicited an unusually high return of 33%, we found that there was strong support to continue the benefit in some form (68% of responses) and strong interest (63% of responses) in extending the benefit to faculty whose dependents attend universities other than McMaster.

Because of the need to define exactly what types of institutions (universities? community colleges? art institutes? others?) the benefit should apply to and where it should apply (Ontario institutions? other Canadian institutions? anywhere in the world?), we believed that more discussion was needed on the exact terms of this benefit. Consequently, we adopted what is essentially the McMaster Staff Association position for 1997/98 and hope to have an extended benefit in place with transition arrangements for 1998/99.

4. Out-of-Hospital Nursing Care. This is an improvement to our medical coverage. Currently our plan repays $30,000 of $50,000 in out-of-hospital services of a nurse or licensed medical aid in any year. This is done in a stepped fashion (40% of the first $25,000 and 80% of the next $25,000). The current benefit is "restored" over a three-year period so that if not used, after three years (at $10,000 per year) the full benefit is restored. The revised benefit restores the amounts over two years ($15,000 per year), making money available faster to those who need to make use of this benefit.

5. Modem Pool. The value of the modem pool has been maintained. The Administration initially suggested using the $20,000 budget to enhance the scholarly activities of faculty in another way than directly tied to modem access. It was agreed, however, that there has not been sufficient experience with this benefit and that use of the modem pool appears to be growing, especially in the area of teaching. Because of this, the modem pool has been maintained at $20,000 per year as per the 1996/97 remunerations agreement.

6. Devices and Other Benefits. Discussions are ongoing in the area of expanding the list of devices currently allowed under our medical plan by introducing payment caps and co- payments to keep the total costs at the current level. As well, there will be discussions about where to "spend" our over-contributions for the orthodontic and major restorative part of our dental plan. The Staff Association "bought" family vision care benefits with their contribution, but there are also possibilities to improve major restorative dental treatment (currently at 50%) or make some adjustment of co-payments on medical devices with the money. These ideas are currently under discussion.

CONCLUSION. the Agreement reached on March 13, 1997 is a complicated one. We on the MUFA negotiating team support the Agreement because we feel it goes a long way to moving us to "normalcy". As well, it agrees with the principles that we felt were central to our position:

We achieved an ATB (small, but meaningful);

We achieved the catch-up CP/M from 1994 and 1995;

We returned the CP/M par values to their normal level of 120 par units per 100 faculty members;

We have eliminated unpaid days in the second year of the contract.

In all, we feel the Agreement to be a fair one for both MUFA and the Administration.

We encourage you to attend the open session to discuss the Agreement on April 2, 1997 at 1:00 p.m. in MGD B107. At that session, we will try to answer your questions about the Agreement. As well, we encourage you to return the enclosed ballot and to exercise your right to vote.