Nova Scotia

Union wins representation on NewPage Port Hawkesbury pensions

NewPage Port Hawkesbury Corp has had its court protection from creditors extended until Dec. 9.

The Communications, Energy and Paperworkers Union won the right to represent 1,100 current and retired NewPage Port Hawkesbury union members in negotiations over the future of their badly underfunded pension plans. Included will be pensions for 452 retirees.

NewPage Port Hawkesbury Corp also had its court protection from creditors extended until Dec. 9.

Nova Scotia Supreme Court Justice David MacAdam granted the company's request during a hearing Wednesday morning. MacAdam asked what would happen if the mill failed, or was only partially used in future.

"It's speculation on his part … we can't speculate," said Archie MacLachlan of CEP Local 972.

Blair Sampson, a mill retiree who drove from Isle Madame to be in court, worried his benefits might be sacrificed in the sale of the mill. "If we don't have a vote then how are we represented?" he asked.

"The union is responsible for its paying members first and foremost. They have to do that, so the retiree is not a member of the union anymore. He's non-voting, so there lies the problem in my eyes."

Ray Larkin, a lawyer for the union, said it will protect the pensions. "Our objective will be to ensure they get the best possible outcome in terms of the maintenance of the pensions."

He said pensioners and active employees have a shared interest in the pensions.

"If you wind up a plan that is substantially underfunded, all the benefits get cut in proportion to the underfunding, so it's a disaster to both the pensioners and the active employees."

The judge ruled that retirees can opt out of union representation and must be notified of significant developments. The court must approve any deals affecting pensioners.

"[We] did have concerns that we raised with the court that the pensioners that are no longer working for the company should have adequate representation … and I think the court addressed our concerns," said Matthew Harris for Ernst & Young, the court-appointed monitor.

Credit protection extended and potential buyers narrowed down

NewPage Hawkesbury owes $156 million to hundreds of unsecured creditors.

Ernst & Young told the court that the number of qualified buyers for the pulp and paper mill has been reduced to 14 from 21.

Some want to operate the mill, while others want to sell off the assets.

The deadline for formal bids for the mill is open until Oct. 14.

Meanwhile, the provincial cabinet has given Nova Scotia's superintendent of pensions the authority to appoint an independent administrator of four pension plans at NewPage. Morneau Shepell will oversee the funds.

When the mill closed last month, 1,000 people lost their jobs — 600 in the mill and 400 people who work in the woods. Many others depend on the plant for indirect jobs.