OTTAWA -- The second-largest federal union is turning down the Harper government's invitation to early contract talks because its members won't trade severance pay for a bigger wage increase.

The Professional Institute of the Public Service of Canada was to begin a round of "expedited talks" this week with Treasury Board, but its six bargaining groups made an 11th-hour decision to pull the plug.

"My members aren't willing to sell the future for a wage increase now," said PIPSC President Gary Corbett. "This is about concession bargaining and, if we do it, we will open the door to more concessions that will affect the public service of the future."

The decision was unanimously supported Monday by the union's bargaining groups, which negotiate on behalf of federal engineers, architects, land surveyors, nurses, doctors, psychologists, researchers, scientists, computer specialists, and commerce officers.

At the centre of the standoff is the surrender of severance pay, which public servants are entitled to when they retire or leave. Existing employees will still get the severance pay they have accumulated during their working years, but it would be eliminated for new workers.

The government has negotiated a tentative deal with the giant Public Service Alliance of Canada that calls for a three-year, 5.3-per-cent wage increase. It includes giving up severance pay for voluntary departures.

That deal has not been ratified. Less than one per cent of the 5.3-per-cent raise was compensation to offset the loss of severance pay.

PSAC has been criticized for making such a major concession. Along with a larger pay increase, PSAC also negotiated increased payouts for existing workers and some improved severance for laid-off workers.

The deal has become a flashpoint for some unions and workers concerned about giving up a benefit that workers have enjoyed for decades.

"It's a slippery slope when you start playing with benefits in collective agreements," said Ron Cochrane, co-chair of the union-management National Joint Council.

Corbett said PIPSC expected to be offered the same deal, but his members weren't willing to consider the concession. He said the union will now wait until its various contracts expire and resume normal collective bargaining.

Donald Savoie, of the Universite de Moncton, said, given today's economic climate, public servants are out of touch by fighting to hang onto benefits most Canadians can't imagine.

"They have indexed pensions, so to fight over severance, which they get just because they hang in there for 25 or 30 years, I think might require a dose of reality."

Severance pay is estimated by PSAC to cost the government about 1.3 per cent of the yearly $30-billion payroll.