In 2012, the federal government passed Bill C-38, the Jobs, Growth and Long-term Prosperity Act, which among other things amends the Canada Labour Code (the Code) to implement insurance requirements for long-term disability (LTD) plans in the federally-regulated private sector, as previously discussed here. Federally-regulated employers (that is, those in industries such as telecommunications and… Continue Reading
Category Archives: Canada Pensions & Benefits Law
Subscribe to Canada Pensions & Benefits Law RSS FeedPooled Registered Pension Plans – Status Update
Posted in Canada Pensions & Benefits Law, Innovation & Plan Design, Pension ReformTo address concerns about pension coverage in Canada, the federal government introduced the concept of the pooled registered pension plan (PRPP) in late 2011 through Bill C-25, the Pooled Registered Pension Plan Act (PRPP Act). The PRPP is intended to provide a “low cost” and accessible retirement savings vehicle for Canadians who do not currently… Continue Reading
Ontario Budget 2013 – More Pension Reform to Come
Posted in Canada Pensions & Benefits Law, Family Law Issues, Innovation & Plan Design, Legislation & Regulations, Pension Reform, Public Sector PlansIn today’s budget, the Ontario government announced that it is continuing with its pension reform agenda, but it is not all “old news”. Perhaps of most interest to employers and plan administrators will be the government’s intention to review the implications of the recent Carrigan case and its expanded interest in alternative plan designs.
Expert Committee Pressing for Pension Reform in Quebec
Posted in Canada Pensions & Benefits Law, DB Plan Funding, Pension ReformBack in the fall of 2011, an expert committee chaired by Alban D’Amours was mandated by the Quebec government to analyze the state of the Quebec retirement income system and to make recommendations on how to improve it in light of the new economic and demographic realities. The Committee released a voluminous report on April… Continue Reading
Plan’s Funded Status Required to be Disclosed under Freedom of Information Request
Posted in Canada Pensions & Benefits Law, DB Plan Funding, Plan AdministrationPension plan sponsors may be surprised to learn that information provided to pension regulators pursuant to statutory filing obligations could be more widely disclosed through an “access to information” request. In a recent decision, the B.C. Assistant Information and Privacy Commissioner ordered the B.C. Financial Institutions Commission (FICOM), which regulates B.C. registered pension plans, to… Continue Reading
Carrigan Case: Supreme Court of Canada Dismisses Leave to Appeal
Posted in Canada Pensions & Benefits Law, Family Law Issues, Plan AdministrationThis morning, the Supreme Court of Canada dismissed the application for leave to appeal in Carrigan v. Carrigan Estate. As a result, the Ontario Court of Appeal’s new interpretation of the priority scheme for the payment of pre-retirement death benefits under the Ontario Pension Benefits Act (the PBA) is now settled law. It would appear… Continue Reading
Ratansi: Court Clarifies Treatment of Employees Who Are Transferred as Part of Transaction
Posted in Canada Pensions & Benefits Law, Legislation & Regulations, Public Sector Plans, Sale of BusinessThe Ontario Divisional Court’s recent judgment in Ontario Pension Board v. Ratansi has overturned an earlier decision of the Financial Services Tribunal and restored an understanding established by previous Tribunal precedents. Employees who have transferred to a new employer as a part of a sale of business or divestment are not entitled to receive pension… Continue Reading
Indalex: What Are the Pension Implications?
Posted in Bankruptcy, Canada Pensions & Benefits Law, DB Plan FundingOn February 1, 2013, the Supreme Court of Canada released its much anticipated decision in Sun Indalex Finance, LLC v. United Steelworkers, a case which pitted the claims of pensioners against those of secured creditors in the context of the insolvency of the employer plan sponsor. The Supreme Court’s decision in Indalex largely overturned the… Continue Reading
Quebec Court of Appeal Refuses to Authorize Pension Class Action
Posted in Canada Pensions & Benefits Law, Plan AdministrationThe recent Quebec Court of Appeal decision in Rousselet v. Corporation de l’École polytechnique confirmed some useful legal principles in its analysis: the pension committee of a registered pension plan is a legal entity separate from the plan sponsor and is thus liable for its own actions and omissions; the time limit to challenge a… Continue Reading
FSCO Updates Family Law Forms
Posted in Canada Pensions & Benefits Law, Family Law Issues, Plan AdministrationThe Financial Services Commission of Ontario (FSCO) has posted revised family law forms which plan administrators, plan members and their spouses/former spouses must use when plan members or their spouses are seeking a valuation and division of pension assets on marriage breakdown. Plan members and/or their spouses/former spouses must use these new forms immediately when… Continue Reading
Re Northern Sawmills Inc. – Court Considers Post-Indalex Pension Claims in Receivership
Posted in Bankruptcy, Canada Pensions & Benefits Law, DB Plan FundingThis is another post-Indalex pension deficit priority case. Due to factual differences from Indalex, however, the pension claims were largely rejected. In the fall of 2008, Northern Sawmills Inc. idled its operations and laid off most of its employees. In January 2011, PricewaterhouseCoopers was appointed as Receiver over the assets of Northern Sawmills Inc., pursuant… Continue Reading
Pension Plan Restructuring (Part IV) – Plan Amendments
Posted in Canada Pensions & Benefits Law, Plan AdministrationThere are other ways to restructure your defined benefit plan to decrease future costs that are typically less drastic than the conversion to defined contribution or plan wind-up options discussed in my previous posts. Benefit Reductions For example, plan amendments to: eliminate or reduce ancillary benefits such as unreduced (or partially reduced) early retirement and bridge… Continue Reading
Re Amcor Packaging: Court Corrects Plan Amendment Made in Error
Posted in Canada Pensions & Benefits Law, Plan AdministrationAfter finding that an erroneous amendment to its pension plan had the unintended effect of increasing benefits payable under the plan to deferred vested members who elected to retire before their normal retirement date, Amcor Packaging Canada, Inc. (Amcor) successfully applied to the Ontario Superior Court to have the plan text corrected. Background In an… Continue Reading
Quebec Budget Forecasts Further Pension Reform
Posted in Canada Pensions & Benefits Law, Innovation & Plan Design, Pension ReformLast month, the Quebec government posted its budget for 2012-2013, which included a number of pension-related items. Expert Committee: The committee tasked with studying Québec’s retirement system, chaired by Alban D’Amours, is expected to table its report in early 2013. The recommendations of the Expert Committee will likely lead to a round of pension reform… Continue Reading
Upcoming Webinar re Carrigan Case
Posted in Canada Pensions & Benefits Law, Plan AdministrationIn a post earlier this month, we wrote about the Ontario Court of Appeal’s recent decision in Carrigan v. Carrigan Estate. As many have heard, it has changed our understanding of the priority scheme for the payment of pre-retirement death benefits under the Ontario Pension Benefits Act. In a nutshell, the Ontario Court of Appeal decided that if… Continue Reading
CRA Pension Limits for 2013
Posted in Canada Pensions & Benefits Law, Plan AdministrationThe Registered Plans Directorate at the Canada Revenue Agency has updated the rates for money purchase, registered retirement savings plan, deferred profit sharing plan and defined benefit limits, which may be used to calculate pension adjustments, past service pension adjustments and pension adjustment reversals. The Directorate has also increased the Year’s Maximum Pensionable Earnings (YMPE)… Continue Reading
No Divorce from Spouse #1? Common Law Spouse #2 Not Entitled to Pre-Retirement Death Benefits
Posted in Canada Pensions & Benefits Law, Family Law Issues, Plan AdministrationIn the recent case of Carrigan v. Carrigan Estate, the Ontario Court of Appeal has effectively re-written the law on pre-retirement death benefits under the Ontario Pension Benefits Act (the PBA). Up until now it has been commonly accepted that if a pension plan member dies prior to retirement, then the member’s spouse on the… Continue Reading
Alberta Introduces New Pension Legislation
Posted in Canada Pensions & Benefits Law, DB Plan Funding, Innovation & Plan Design, Legislation & Regulations, Pension ReformAlmost four years after the Joint Expert Panel on Pension Standards (JEPPS) submitted its final report with recommendations to fundamentally reform Alberta and British Columbia’s pension systems, the Alberta government has introduced Bill 10, Employment Pension Plans Act. Similar to B.C.’s Bill 38, which was passed earlier this year, Bill 10, if passed, will replace… Continue Reading
Régie Des Rentes Releases Unfavourable Position on Margins for Adverse Deviations
Posted in Canada Pensions & Benefits Law, DB Plan Funding, Plan Administration, Regulator Policies & CommunicationsEffective December 31, 2010, revisions were made by the Canadian Institute of Actuaries (CIA) to its Standards of Practice – Practice-Specific Standards for Pension Plans. In particular, the revised CIA Standards of Practice now provide that assumptions for going concern valuations are either best estimates or best estimates modified to incorporate margins for adverse deviations… Continue Reading
Alberta Extends Solvency Funding Relief
Posted in Canada Pensions & Benefits Law, DB Plan Funding, Legislation & Regulations, Regulator Policies & CommunicationsFollowing up on the solvency funding relief for Alberta specified multi-employer pension plans (SMEPPs) which was passed last year, the Alberta government recently amended the Employment Pension Plans Regulation to also provide solvency funding relief to defined benefit plans which are not SMEPPs. Notably, the regulation does not require any form of member consent, or… Continue Reading
Timberwest Forest Corp. v. Gustavson: Limits on Employer’s Right to Amend Post-Retirement Benefits
Posted in Benefit Plans, Canada Pensions & Benefits LawAs more post-retirement cases actually go to trial, we are starting to get a sense of what factors judges consider relevant in determining whether an employer will be permitted to reduce or eliminate post-retirement benefits. In this British Columbia Supreme Court decision, released on August 16, 2012, the personal circumstances of the plaintiff, Mr. Gustavson,… Continue Reading
Update on Reducing Benefits in Federal DB Pension Plans
Posted in Canada Pensions & Benefits Law, Plan Conversions, Regulator Policies & CommunicationsOn July 19, 2012 OSFI issued its final Instruction Guide – Authorization of Amendments Reducing Benefits in Defined Benefit Pension Plans, which replaced the previous April 2006 version. The Guide sets out the factors and specific requirements (e.g., valid amending power – unilateral or mutual by affected groups, legislative compliance, options considered, plan viability and… Continue Reading
Ontario Pension Reforms Come into Force
Posted in Canada Pensions & Benefits Law, Legislation & Regulations, Pension Reform, Plan Administration, Plan Wind-UpsAs of July 1, 2012, a number of amendments to the Ontario Pension Benefits Act (PBA) and related amendments to the general regulation under the PBA were proclaimed in force. Employers and plan administrators should carefully review their plans and their administrative practices to ensure that they continue to be compliant with the PBA, and… Continue Reading
CAPSA Releases Draft Guideline re DC Plans
Posted in Canada Pensions & Benefits Law, DC Plans, Regulator Policies & CommunicationsIn an effort to provide further guidance to administrators of defined contribution (DC) pension plans, the Canadian Association of Pension Supervisory Authorities (CAPSA) has released a draft “Defined Contribution Pension Plans Guideline” (the Guideline) for comment. The Guideline is intended to supplement existing CAPSA guidelines (i.e., Guideline No. 3 – Capital Accumulation Plans, Guideline No…. Continue Reading