Former mill workers suing over pensions

Nearly 50 retired employees of the former Pope & Talbot Harmac pulp mill are part of a registered class action lawsuit.

Nearly 50 retired workers of the former Pope & Talbot Harmac pulp mill are part of a registered class-action lawsuit challenging reductions to their pension plan.

The suit – against Alan Clark, retired superintendent of pensions for B.C.; the Financial Institutions Commission for B.C.; the Province of B.C.; and Morneau Sheppell Inc. – involves 88 retired Pope & Talbot salaried employees who worked at the company’s B.C. operations in Nanaimo, Grand Forks, Castlegar, Fort St. James and Midway before it went bankrupt in 2008.

The employees, and widows of those employees, are suing because steep reductions to their pensions were ordered, resulting in losses of approximately $3 million and ongoing losses estimated to be more than $15 million.

William Faminoff, lawyer for the retired employees, said in a press release that at the time of Pope & Talbot’s bankruptcy, the pension was underfunded and had a 30 per cent deficiency, but pensioners thought they were safeguarded by a provision in the plan that gave them priority as retired members.

The suit alleges the superintendent of pensions contacted Pope & Talbot’s management in the company’s final months, demanding it get rid of the priority provisions, and when it refused to do so, he took matters into his own hands and ordered that the provisions be disregarded.

The pensioners claim the superintendent had no authority to overrule the terms of a registered pension plan.

Donald Stewart, a member of the suit’s steering committee, worked at Harmac as a maintenance supervisor from 1968 to 2004 and had no idea there was trouble with the plan until a 2010 letter from Morneau Sheppell, the company hired by the superintendent of pensions to  administer the pension plan,  indicated the pensions would be reduced by 30 per cent retroactive  to 2008.

“There was a contract in place that we would receive the pension for the rest of our lives and all of a sudden it’s reduced 30 per cent by no fault of our own,” he said. “It’s less retirement income and now we have to rework our priorities.”

Stewart wants to see the pension plan reinstated but has no idea on a timeline for the suit.

“It’s been registered in the courts and right now lawyers are talking to lawyers,” he said. “There’s no real timeline but we’re hoping it’s sooner than later.”

The Harmac mill was bought out of bankruptcy by a group of employees and private investors in 2008 and is running profitably.