VIA Rail Makes Global Offer to the Canadian Auto Workers

Fair and reasonable offer should avoid a strike

MONTREAL, June 13, 2013 /CNW Telbec/ - Yesterday, VIA Rail Canada presented a global offer to the Canadian Auto Workers (CAW) union which if accepted will avert a strike set to begin on June 14 at 12:01 AM Eastern Daylight Time. The main elements of the global offer are:

With respect to the terms of the collective agreements:

• Wage increases of 2% in 2013, 2% in 2014, and 2% in 2015;
• Existing benefit plans are maintained;
• Work rules are improved; and
• Existing job security provisions for full time employees are maintained.

With respect to pensions:

• An increase in employee contributions in order to maintain the existing Defined Benefit pension plan for current unionized employees; and
• A new hybrid Defined Benefit/Defined Contribution pension plan for new employees hired as of 2014.

"We feel this is a fair and reasonable offer," said Marc Laliberté, the President and Chief Executive Officer of VIA Rail Canada. "Unlike other companies in the rail industry, VIA is a Crown corporation. We have an obligation to make the best use of taxpayer monies. Our latest operating subsidy was $279 million, and our pension plan for unionized employees shows a deficit of $419 million, which is putting significant cost pressures on our bottom line. This offer, in particular the parts related to pensions, will help ensure the sustainability of both our company and the pension plans, and that's in the long-term best interests of our employees."

In 2012, VIA Rail bore 65% of the current service costs for the unionized pension plan, while unionized employees bore 35%; with the increase in employee contributions proposed by VIA, the cost-sharing split will be 50/50 by 2016. Also in 2012, the solvency deficit for VIA's plan for unionized employees ($419 million) was nearly twice what VIA earned in total revenues ($277.6 million).

VIA Rail and the CAW (which represents service, sales office and maintenance personnel), have been in negotiations since the fall of 2012. Parties have been in conciliation since April and are now currently in mediation.

In the event of a work stoppage, VIA Rail will continue to offer basic rail services using qualified management employees. More information about VIA Rail's contingency plan can be found on VIA Rail's website at www.viarail.ca/en/collective-bargaining or by contacting 1 888 VIA-RAIL (842-7245), 1 800 268-9503 (hearing impaired).

During these negotiations, VIA Rail is keeping passengers and the public informed of any development through its website at www.viarail.ca, on Facebook or Twitter @VIA_rail.

About VIA Rail Canada
As Canada's national rail passenger service, VIA Rail Canada's mandate is to provide safe, efficient and economical passenger transportation service, in both official languages of our country. VIA operates intercity, regional and transcontinental trains linking 450 communities across its 12,500-kilometre route network. Recipient of the Railway Association of Canada's Safety Award in 2011 for the 11th time in 12 years, and of the 2012 Agent's Choice Award voted by Canadian travel agents and presented by Baxter Travel Media, VIA safely transports nearly four million passengers annually. Since 2007, the Government of Canada has invested almost a billion dollars in VIA Rail. Follow the progress of our transformation at http://www.viarail.ca/en/about-via-rail/capital-investment.

Follow us on our Evolution Blog at www.viaevolution.ca.

SOURCE: VIA Rail Canada Inc.