Facing mounting financial pressure, NTCL says it wants to cut back on pension payments for current and former NTCL employees
by Michael Mata
Enormous debts and looming permanent layoffs are plaguing Northern Transportation Company Limited (NTCL), the marine transportation company that has served the Western Arctic for nearly 70 years. NTCL says it wants to cut back on pension payments for current and former NTCL employees. The fund covers 622 employees, including 83 individuals who still work for the company.
Last Friday, NTCL’s attorneys stated in court that the company should no longer be obligated to make special monthly payments of $229,000 into the NTCL pension fund. The payments began in 2011, in addition to NTCL’s regular pension payments. The additional payments are meant to make up for the shortfall in the pension fund, whose assets are valued at approximately $100 million, but still lacks approximately $20 million.
Friday’s court proceedings come after the company’s recent admission that it is highly unlikely it will be able to find a successor to continue its business, even going as far as to partially blame the pension fund for making the company unattractive to bidders.
The Union of Canadian Transportation Employees, which represents 49 NTCL workers, denounced the company’s latest move as “atrocious”.
"The employees should be the first ones compensated before any creditors," stated Teresa Eschuk, the regional vice president representing NTCL members. Eschuk further hinted that shady financial dealings may be responsible for the pension fund’s shortfall. "At one point in time, and I'm not talking that long ago, this pension plan had a surplus of over $20 million. My question is, what happened to it?" said Eschuk.
NTCL’s imminent demise is likely to have a negative impact on Hay River, a small town in the Northwest Territories. Hay River is the location of NTCL’s main office, and the company employs many locals. Pensioners and residents are likely to pack up and seek better opportunities once NTCL folds due to the rising cost of living and limited employment opportunities in the North.
Enormous debts and looming permanent layoffs are plaguing Northern Transportation Company Limited (NTCL), the marine transportation company that has served the Western Arctic for nearly 70 years. NTCL says it wants to cut back on pension payments for current and former NTCL employees. The fund covers 622 employees, including 83 individuals who still work for the company.
Last Friday, NTCL’s attorneys stated in court that the company should no longer be obligated to make special monthly payments of $229,000 into the NTCL pension fund. The payments began in 2011, in addition to NTCL’s regular pension payments. The additional payments are meant to make up for the shortfall in the pension fund, whose assets are valued at approximately $100 million, but still lacks approximately $20 million.
Friday’s court proceedings come after the company’s recent admission that it is highly unlikely it will be able to find a successor to continue its business, even going as far as to partially blame the pension fund for making the company unattractive to bidders.
The Union of Canadian Transportation Employees, which represents 49 NTCL workers, denounced the company’s latest move as “atrocious”.
"The employees should be the first ones compensated before any creditors," stated Teresa Eschuk, the regional vice president representing NTCL members. Eschuk further hinted that shady financial dealings may be responsible for the pension fund’s shortfall. "At one point in time, and I'm not talking that long ago, this pension plan had a surplus of over $20 million. My question is, what happened to it?" said Eschuk.
NTCL’s imminent demise is likely to have a negative impact on Hay River, a small town in the Northwest Territories. Hay River is the location of NTCL’s main office, and the company employs many locals. Pensioners and residents are likely to pack up and seek better opportunities once NTCL folds due to the rising cost of living and limited employment opportunities in the North.
