Not all city agencies follow council's lead to scrap retirement payments

Council's decision in December to stop paying a retirement allowance to departing long-term City of Calgary employees isn't being mirrored by all city agencies.

The practice at city hall, which dates back to the early 1960s, sees retiring employees with at least 25 years service receive a cash payment equivalent to their annual vacation entitlement.

For example, if they qualify for five weeks holidays annually, they'd collect five weeks salary upon retirement.

City council voted 13-1 in December to give notice to its employees that the payments will no longer be offered after the end of 2021.

The city's law department recommended giving advance notice of the program ending. It obtained an independent legal opinion that scrapping the payments any sooner could result in potential legal action from workers or civic unions against the city.

Payments in union contracts

Despite the council vote, the retirement payments will live on at Enmax.

The city-owned utility said it inherited the retirement allowance program in the 1990s when itchanged from being a city department to a wholly-owned subsidiary.

The senior vice president of people, safety and culture at Enmax, Brandie Yarish, said the allowance is included incollective agreements with its two unions.

That means any move to do away with the payments would have to be reached through the collective bargaining process.

Those two unions represent about 60 per cent of Enmax's workforce. Non-unionized staff are also eligible for the allowance.

Yarish said there are no plans to change the practice.

Need to stay competitive

She added that Enmax needs to ensure its compensation stays in line with other companies in the electricity industry.

"We review compensation relative to industry, wanting to ensure that we're competitive," said Yarish.

"So while our shareholder is the City of Calgary, we are a separate entity and compensation is treated separately and there's no direction from the board in terms of the city's practices around retirement allowances and what Enmax intends to do there."

Enmax's policy on paying the retirement allowance is slightly different from the city's long established practice.

While the city makes payments to those retiring to a pension after a minimum of 25 years of service, Enmax gives the cash payment to eligible retiring employees if they have served at least five years with the company.

Yarish said the retirement allowance is just one piece of the compensation puzzle for its employees.

"Our ability to recruit and retain [employees]is incredibly important to us," she said.

Parking authority gives notice

The Calgary Parking Authority (CPA) is another city-owned agency that offers the retirement allowance, which it calls "a vacation bonus for retiring employees."

Unlike the city which has offered the payments for more than 50 years, the Parking Authority has only been providing the payments since Jan. 1, 2017.

It said that was a decision made by a former general manager to bring the CPA in line with the city's compensation policies.

Following the council vote in December to give notice the retirement allowance will be scrapped for city employees, the CPA reviewed the practice for its staff.

It has now toldits employees theywill only be eligible to collect the payment if they retire before July 31, 2020.

The CPA refused to do an interview with CBC News about that decision but it did provide a statement.

"Six months provides employees with reasonable notice of the policy change, given that this bonus was a relatively new piece of our employees' total compensation."

The CPA said it was not directed by the city to change its policy to match council's decision to end the payments.

Councillor supportive

Coun. Sean Chu, who has been a council representative on the CPA's board, said he was unaware of the agency's decision to scrap the payments. But he's supporting the change in direction.

"Kudos to the CPA general manager for doing this. Take the bull by the horn and then do what is necessary, which is very positive," said Chu.

"I think every board or commission or other CEO, they should follow the city and what we're doing."

As the Enmax and Calgary Parking Authority examples show, the rules are not uniform atall city owned companies and agencies.

The Calgary Zoo, the Calgary Municipal Land Corporation and Calgary Economic Development saidthey do not offer retirement allowances to their employees.