Ontario arbitrator rules that standby pay does not constitute pensionable earnings
February 24, 2023
An arbitrator ruled that standby pay did not constitute pensionable earnings in the recent case of Unifor, Local 4211 v. St Lawrence Seaway Management Corporation. The key issue in this case was whether standby pay constituted “remuneration for the performance of the regular duties of the Member’s position”, consistent with the definition of “earnings” provided in the Seaway Pension Plan. The arbitrator considered the terms of the collective agreement, the Seaway Pension Plan, and the bargaining history between the parties, as well as arbitral jurisprudence.
The arbitrator ultimately ruled in favour of the employer, finding that the phrase “performance of regular duties” implied that “earnings”, as defined in the Seaway Pension Plan, meant “remuneration for an act.” Employees on standby do not perform work but undertake to be available should they be required to work. On this basis, the arbitrator found that standby pay did not fall within the definition of “earnings” set out in the Seaway Pension Plan, and was therefore not pensionable.
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