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Brief on Faculty Remuneration for the Period July 1, 2005 to June 30, 2006 |
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Brief on Faculty Remuneration for the Period July 1, 2005 to June 30, 2006 |
1. MUFA remains committed to the “Principles for Negotiation of Faculty Remuneration” as agreed to by the Joint Committee.
2. MUFA proposes a one year contract (July 1, 2005 to June 30, 2006).
3. There are many aspects of McMaster’s faculty benefit package of which MUFA and the Administration can be justly proud. These include the provision of almost all benefits to retirees and the recent (April 19, 2004) agreement to extend benefit coverage to our members with Contractually Limited Appointments. However, some benefits have been eroded because of fixed dollar ceilings that have been in place for many years and hence have not kept pace with inflation. In some cases, MUFA benefits have been surpassed by benefits in the McMaster University Staff Association (MUSA) collective agreement.
MUFA proposes two solutions to this problem. First, MUFA proposes a number of increases in benefits for vision care, hearing care, dental care and other types of health care as detailed in Appendix A. These increases are also intended to offset the recent de-listing of certain types of coverage by the Ontario Health Insurance Plan. (Appendix A also proposes some improvements to plan structure, such as the extension of vision care to dependents, as in the MUSA agreement.) Second, MUFA proposes that from now on, a number of dollar limits on benefits be indexed to across-the-board (ATB) salary increases. We list those dollar limits in Appendix B.
4. As the McMaster website notes, McMaster is “lauded year after year as one of the country's ‘most innovative’ research-intensive universities”. MUFA has two proposals to preserve and enhance this strength. First, MUFA believes that research leaves should be encouraged in order to provide faculty the uninterrupted time to develop highly innovative research projects and the opportunity to visit other centres of research to gather new ideas. Presently most research leaves are granted at 85% salary. MUFA proposes that all research leaves should be at 100% salary. Second, some faculty have no funds for books, journals and other essential requirements for their research either because they have as yet been unable to attract funding for their research or because of restrictions on the research funds they have already won. MUFA proposes that the Professional Development Allowance (PDA) be increased by 20% (that is from $1500 to $1800 per year) and that it be henceforward indexed to ATB salary increases. This would not preclude sub-sequent contracts from providing additional PDA increases.
5. The current salary floors are $40,249, $49,861, $64,455 and $81,600 for Lecturer, Assistant Professor, Associate Professor and Full Professor respectively. These are low compared to other universities, particularly at the Assistant Professor level. (For example, the corresponding floors at the University of Waterloo are $45,000, $58,000, $73,000 and $93,000 and are scheduled to increase by 3.3% in the coming year.) MUFA proposes that all the floors above be increased by 3.3% before the application of the ATB increase discussed below.
6. To quote a MUFA brief from December 11, 2001, “Most faculty have expressed some confidence in the McMaster CP/M [Career Progress/Merit] scheme.” MUFA believes this is still accurate in that most, but not all, faculty members support the Plan and some who do support it have reservations. MUFA proposes three changes that it believes would enhance overall support for and effectiveness of the CP/M scheme. The first is to set the par increment to the level agreed upon in the Joint Committee on November 1, 2000. Under that agreement, the current par increment should be “roughly” 1.5 x the Assistant Professor floor salary/26.25 = 1.5 x $49,861/26.25 = $2849.20 rather than the current $2687.91. Then that par increment and the breakpoints would be increased by the 3.3% and the ATB increase, consistent with proposal 5 above. The second is the elimination of the highest breakpoint in the scheme (at which point the par merit increment is reduced to only 25% of the basic par increment). In this manner, all faculty will have their CP/M increases determined on the basis of a par increment that is at least 50% of the basic par increment. The third proposal is to increase the number of par increments to 130, with 110 awarded at the department level. This will allow departments to reward a member for an outstanding year without necessarily giving some other department member a below-par award.
7. Despite recent increases by the Canada Revenue Agency to the maximum pension, MUFA still believes that current pension arrangements will become increasingly insufficient as over time more of our members will earn more than maximum pensionable earnings. This will create difficulties for the University in recruitment and retention and is inefficient from a personal income tax perspective. MUFA therefore proposes a supplementary pension plan modelled after the arrangements at either the University of Toronto or the University of Waterloo. MUFA also seeks a commitment from the Administration that it henceforward not conclude an agreement with any other employee or employee group regarding supplemental payments (of any kind) that would occur after retirement until a supplementary pension plan agreement with MUFA is in place.
8. MUFA believes that “across-the-board” (ATB) should be just that. Hence ATB should apply not only to salaries but also to floor salaries, overload stipends, par merit increments, CP/M breakpoints and benefit ceilings. For this contract, MUFA proposes an ATB increase of 5.9%, consisting of 2.0% to cover the expected December 2003 to December 2004 rate of inflation plus 1.9% to offset unexpected inflation during the previous contract plus 2.0% for long-term catch-up. This proposal is explained in Appendix C.
1. Paramedical services: This benefit is currently for services provided to a faculty member or her/his dependents by licensed speech therapists, psychologists, physiotherapists, massage therapists, naturopaths, Christian Science Practitioners, osteopaths, chiropractors, podiatrists and chiropodists, with the last four grouped as a single category. For each of these categories, the benefit is limited to $15 per visit and $225 per person per year, although for speech therapists there is no per visit limit, but the annual ceiling is $200 per person. These benefit limits have not been changed for some time (and in most cases prevailed in 1982). As the price level has approximately doubled since 1982, they are now unreasonably low, particularly in light of the de-listing of services provided by physiotherapists and chiropractors. In some cases the MUSA contract has higher limits. MUFA proposes that this benefit be improved and simplified by making it 80% of cost up to a maximum of $500 per person per year for each of the visit categories.
In addition MUFA proposes an additional eighth category of occupational therapy and a ninth category of acupuncture, in each case covering 80% of cost up to a separate $500 limit. MUFA would be prepared to agree that a member would be limited to accessing benefits in seven categories per year, as per the current agreement. MUFA also proposes removing the requirement of “ordered by doctor” for accessing the massage therapist benefit.
2. Visioncare is another area where there has been de-listing and where the McMaster faculty benefit has eroded and has been surpassed by the comparable MUSA benefit. MUFA proposes extending the benefit to $450 per faculty member every two years and allowing that $450 to be accessed by the faculty member and/or her/his dependents. The cost of routine optometry exams that have been de-listed by OHIP would be eligible under this benefit.
3. MUFA proposes that the hearing aid benefit be increased from a maximum of $500 per ear every three years to $1000 per ear every three years.
4. Major restorative services (crowns, dentures, bridges and implants) are currently covered at a rate of 70% up to a per person annual limit of $2,000 and orthodontic services are currently covered at a rate of 50% up to a lifetime limit of $2,000 per covered person. It is not clear why these major dental services receive less coverage than basic dental procedures. Accordingly, MUFA proposes that the benefit rates in both cases be increased to 85% with the dollar limits increased to $3,000. In addition, MUFA proposes that coverage for implants be extended to retirees.
5. The University offers tuition bursaries of up to $3150 per year to dependents of its employees who attend McMaster. MUFA proposes that a new equal dollar bursary be introduced for dependents of faculty and librarians. Eligibility would be determined in the same manner as the bursary tenable at McMaster, but the new benefit would instead be tenable at other universities and colleges.
Appendix B
Benefit Ceilings that MUFA Proposes to Index to ATB Increases1. First, MUFA proposes that most of the new dollar limits in Appendix A would, in addition, be indexed to ATB increases and that this indexation would be in effect unless altered by a subsequent contract. That is, under this proposal, ATB indexing would apply to each of the paramedical category limits of $500 per person, the vision care limit of $450 per person , the hearing aid care of $1000 per ear every three years, the major restorative annual dental benefit limit of $3000 per person and the orthodontic lifetime limit of $3000 per person. MUFA is not proposing a change in the $3150 bursary recognizing that it is applied on a University-wide basis to all employee groups and that the Administration has increased that benefit in the past when tuition has increased.
2. Other dollar limits that should be henceforward indexed to ATB increases include:
(i) the hospital semi-private room differential of $110 per day (in province and out-of-province).(ii) the convalescent hospital or rehabilitation centre amount of $20 per day.(iii) the referred service out-of-province lifetime limit of $10,000.
(iv) the private duty nurse full coverage limit of $10,000 per person and the additional partial coverage limit of $20,000 per person.
(v) the orthopaedic shoe and orthotic limit of $400 per person every two years.
(vi) the lifetime limit of $500 for wigs required because of chemotherapy or disease.
Appendix C
MUFA’s Proposal for an Across-the-Board (ATB) Increase of 5.9%MUFA has two goals for its Across-the-Board increase: to keep pace with current inflation and to catch up to the salary level prevailing in 1991 before the Social Contract.
MUFA (and we believe the Administration) has traditionally used the previous year’s December to December inflation rate in considering ATB. This is because it is known (or very well-estimated) while salary negotiations are underway. The December 2003 to December 2004 inflation rate is likely to be approximately 2.0%. (The October 2003 to October 2004 inflation rate is 2.3%.) Hence, that is one component of the MUFA proposal for ATB. We will adjust this aspect of our proposal when the December 2003 to December 2004 inflation rate becomes known.
The catch-up proposal is based on Table 1 below. It can be seen that a restoration of the salary level prevailing in 1991 would require an additional one-time increase of 10%.
MUFA’s Negotiations Committee has decided to temper this demand, recognizing that it is more reasonable to restore the 10% shortfall over a number of years. The March 4, 2002 agreement between MUFA and the Administration is consistent with the principle of gradual catch-up. It can be approximated as providing an ATB of 3.6% (more precisely, 3.0% + $500) for each of three years. At the time the agreement was struck, the applicable first-year inflation rate was known to be 0.7% so the agreement provided 3.6% - 0.7% = 2.9% catch-up in that year. In subsequent years, it would have been reasonable to expect an inflation rate of 2.0% per year. Under that assumption, a catch-up of 3.6% - 2.0% = 1.6% was expected. Hence the average expected catch-up per year was about (2.9 + 1.6 + 1.6)/3 or about 2%. MUFA therefore proposes that the upcoming contract continue that catch-up rate of 2.0% per year.
Finally, as Table 1 also shows, there was a burst of inflation of 3.9% after the contract was signed. As noted, an expected rate of inflation would have been more likely about 2%. Hence, real faculty salaries at the end of the current contract were about 3.9% - 2.0% = 1.9% lower than might reasonably have been expected at the time the contract was signed. MUFA therefore proposes an additional catch-up of 1.9% to offset this unexpected burst of inflation. MUFA also notes that this is a conservative estimate of additional required catch-up, because after the contract was signed, the partial pension contribution holiday was suspended and recently the province introduced new health premiums.
To summarize, MUFA proposes a total ATB of 5.9% consisting of 2.0% to compensate for the applicable rate of inflation for the current contract plus 2.0% long-term catch-up plus 1.9% to offset unexpected inflation during the 2002 to 2005 contract.
YEAR (1)
December to December Inflation Rate (Previous Year)1(2)
ATB Paid to Faculty at McMaster2(3)
Cumulative Real Decrease in Salaries(4)
Catch-up Required to Attain 1991 Real Level(5)
CP/M Paid at McMaster (par units per 100 faculty)From 1991 until most recent agreement:
1991/92 5.0% 5.0% - - 120 1992/93 3.8% 2.0% 1.7% 1.7% 120 1993/94 2.1% 0.0% 3.8% 3.9% 110 1994/95 1.7% -0.5% 5.8% 6.2% 110 1995/96 0.2% 0.0% 6.0% 6.4% 55 + 553 1996/97 1.7% 0.0% 7.6% 8.2% 80 + 303 1997/98 2.2% 0.0% 9.6% 10.6% 120 1998/99 .7% 1.0%4 9.3% 10.3% 120 1999/00 1.0% 1.25%5 9.2% 10.1% 120 2000/01 2.6% 0.5% 11.0% 12.4% 120 2001/02 3.2% 1.25%6 12.7% 14.6% 120 Most recent agreement (March 4, 2002):
2002/03 .7% 3.6%7 10.2% 11.4% 120 2003/04 3.9% 3.6%7 10.4% 11.7% 120 2004/05 2.0% 3.6%7 9.0% 10.0% 120 Notes:
1. Based on Consumer Price Index, Canada, All items, not seasonally adjusted.
2. Figures in this column do not include one-time salary cuts in the form of unpaid days, or one-time payments.
3. Payment of the second portion of 1994 and 1995 merit (85 of 110 par units) began January 1, 1999.
4. Scale increase of 1% on May 1, 1999.
5. November 1999.
6. October 2001.
7. Approximation: actual faculty increase was 3.0% across the board plus $500.Joint Committee
December 15, 2004