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Pensions & Benefits Law A Discussion of Canadian and U.S./Cross-Border Pension & Benefit Legal Issues

Category Archives: Canada Pensions & Benefits Law

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New Requirements re Insurance for LTD Plans of Federally-Regulated Employers Coming Into Force in 2014

Posted in Benefit Plans, Canada Pensions & Benefits Law, Legislation & Regulations

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

Pooled Registered Pension Plans – Status Update

Posted in Canada Pensions & Benefits Law, Innovation & Plan Design, Pension Reform

To 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 Plans

In 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 Reform

Back 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 Administration

Pension 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 Administration

This 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 Business

The 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 Funding

On 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 Administration

The 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 Administration

The 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 Funding

This 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 Administration

There 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 Administration

After 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 Reform

Last 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 Administration

In 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 Administration

The 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 Administration

In 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 Reform

Almost 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 & Communications

Effective 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 & Communications

Following 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 Law

As 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 & Communications

On 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-Ups

As 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 & Communications

In 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