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About 3,700 federal public service workers have applied for early retirement since the government launched a new measure late last month in a bid to help reduce the public service workforce.
The applicants aim to join the Early Retirement Incentive (ERI) program the government launched on March 27, Mohammad Kamal, spokesperson for the Office of the President of the Treasury Board, told The Canadian Press.
Under the program, eligible employees can retire early with an immediate pension based on their years of service, with no reduction for retiring before the normal pension age, according to a release from the Treasury Board.
Normally, public service employees who retire early face a permanent pension reduction of 5 percent for each year they retire before the pension age. For example, retiring five years early would reduce the pension by 25 percent. Under the ERI program, eligible employees can retire early without any reduction, with their annual pension calculated based on total years of service up to the retirement date. They can apply until July 24, 2026.
To participate, employees must meet specific age and service requirements on the day after their last day of employment, with retirement no later than Jan. 20, 2027. Those who joined the pension plan on or before Dec. 31, 2012, must be at least 50 years old, with at least two years of pensionable service and 10 years of public service employment. Employees who joined on or after Jan. 1, 2013, must be at least 55, with the same minimum service requirements.
The Professional Institute of the Public Service of Canada (PIPSC), representing over 80,000 public sector professionals, accused the government of bypassing collective agreements. In a press release on April 2, it said public service professionals are being pushed to make irreversible career decisions without full information or agreed safeguards as the government rolls out the ERI program outside the negotiated Workforce Adjustment framework.
“We support early retirement as a way to avoid layoffs, but it must be implemented through the workforce adjustment framework set out in collective agreements,” said PIPSC President Sean O’Reilly. “In this case, the federal government has bypassed that framework, acted unilaterally, ignored its consultation obligations, and put hard-won protections at risk. That’s a dangerous precedent.”
PIPSC, which said it has filed a policy grievance, also said the program is using pension assets as funding.
“Using pension assets to fund early retirement means workers are effectively financing their own layoff,” said O’Reilly. “That’s completely inappropriate for a decision of this scale. It should be treated as an employer cost, not shifted onto employees.”
