You wrote a thought-provoking piece in the paper about salaries at city hall (100K club doubled since '07, Burnaby NOW, July 8).
When determining fair compensation, it is important to look at the total compensation package. This includes salaries, benefits and pensions. The total comp package at the city is worth about 40 per cent more than the salaries alone.
Many employee benefits at the city are for items that employees do not receive until the point at which they retire. I can assure you these benefits and final salary pensions are not paid in the private sector. The city owes future retiring employees millions for such thing as termination benefits and earned sick leave payouts.
Pensions are a form of deferred compensation that is paid after the employee leaves the service of city hall. These pensions are based on the final average salary of employees and pay 70 per cent of this salary for life. The average life expectancy of retired Canadians is now 84.
An employee who retires at age 55 with a $100,000 salary will receive $70,000, including CPP, the first year of retirement, and it will increase every year after that.
Based on an index factor of two per cent for cost of living, the employee who leaves at age 55 with this level of pension, and there are obviously many in Burnaby, will get another $2.8 million in "compensation" from his pension. Calculate this into the level of compensation and I would suggest that city taxpayers have good reason to be in an uproar. An average employee will earn far more in retirement than they ever earned during their working career.
To suggest employees should be compensated the same as chief operating officers and chief financial officers is reasonable, however most businesses only have one person in these positions, not 73. The compensation bonus that city employees are paid is estimated to be an additional 30 per cent by the Canadian Federation of Independent Business in the Wage Watch report when compared with the private sector. I agree on the importance of competent people at all levels, but let's do a fair comparison with the salaries of taxpayers.
Bill Tufts/Fair Pensions for All, by e-mail