Malcolm Gorrill
Northern News Services

Yellowknife (Mar 08/00) - Workers at the Giant Yellowknife mine did not learn until recently how seriously underfunded their pension fund for hourly workers was, a union official says.

Steve Petersen, plant chair of the Canadian AutoWorkers Local 2304, says the pension fund was a "non-contributing plan," so the union had no control over it.

"We were also not privy to the interest on the investments, or to the status of the plan," Petersen says, "whether it was funded or fully funded or underfunded."

"We weren't able to get figures because we were not the administrators."

Petersen says miners first heard of pension woes in April 1999 when Royal Oak went into receivership. The receivers, PricewaterhouseCoopers Inc., told the miners then that anybody receiving a pension from then on would be getting about a 10 to 12 per cent reduction.

Under the plan, in accordance to the workers' collective agreement, Royal Oak Mines, owners of the Giant mine, donated about $1.60 per hour per employee to a maximum of 1,800 hours per year (roughly $5,000 per year).

"So even though we were aware that it was in trouble," Petersen says, "we were never able at any point to get a clear word from anybody exactly how much trouble it was in."

Petersen says it wasn't until after Miramar bought the Giant mine in December 1999, and Deloitte and Touche Inc. became administrators of the pension plan, that the miners heard worse news.

"They not only penalized the upcoming pensioners, they also went back and clawed back the existing pensioners -- not by 12 per cent, but everyone by 25 per cent."

The pension clawbacks are due to take effect April 1.

Petersen says the exact amount of the pension shortfall is still unknown.

He says representatives from Morneau Sobeco, a subsidiary of Deloitte and Touche will hold public hearings today in Yellowknife with the workers.