Retired AbitibiBowater mill workers are being told they could lose a substantial portion of their pensions unless the federal government steps in to protect them from the possibility that the financially troubled company could become bankrupt or be radically restructured early in the new year.

The warning comes from the national president of the Communications, Energy and Paperworkers union, Dave Coles, who has been travelling to communities hit hard by the money problems plaguing AbitibiBowater.

Coles was in Grand Falls-Windsor in central Newfoundland and Stephenville on the west coast during the weekend, telling mill pensioners that their incomes could plummet by 30 per cent if AbitibiBowater goes under.

"It's really immoral what's taking place," he told CBC News. "They wake up to find out their pensions are insecure."

The company has been under court protection from bankruptcy since April, while it tries to work out its financial woes.

Coles said the key source of the problem is AbitibiBowater's pension plan, which he said would be $1.3 billion short of being able to meet its obligations if the company were wound up.

He urged the pensioners to help the union lobby Ottawa to set up a federally backed trust fund to guarantee pension payments.

"It will require a lot of heavy lifting by everyone, including the pensioners. The pensioners are going to have to get angry, get involved."

The union is lobbying politicians, and during his visit to central Newfoundland Coles conferred with the Liberal MP for the region, Scott Simms.

"This is big trouble, this is very big trouble," said Simms, who represents Bonavista-Gander-Grand Falls-Windsor in Parliament.

He said hundreds of families across the province would be devastated if their pensions took a big cut.

"These pensions are keeping these families here," he said. "That's why the federal government has to step up in this particular sector."

Coles said AbitibiBowater plans to be back in court in February as it continues to seek relief under the Companies' Creditors Arrangement Act. He said if the federal government doesn't help by then, the pension payouts could plunge a short time later.