Moors v. Canada (Minister of National Revenue), 2015 FC 446

Ms. Moors, a member of the Ontario Teachers’ Pension Plan (OTPP), went on maternity leave in November 1998 after her first child was born. She had two more children in 2000 and 2002 and returned to teaching in September 2006. Ms. Moors was given three options with respect to her pension prior to maternity leave: (1) contribute to the plan during the leave of absence; (2) elect to contribute to the plan by April 30 of the year following her return to work; or (3) buy back her pension credits. Options 1 and 2 would result in a pension adjustment being reported, while option 3 would require a past service pension adjustment (PSPA) to be certified prior to the buyback’s implementation. Upon her return to work, Ms. Moors attempted to buy back the pension credits relating to the period of her leave. Canada Revenue Agency (CRA) informed Ms. Moors that for a PSPA to be certified, she must make an RRSP withdrawal. After making an RRSP withdrawal, Ms. Moors still had insufficient RRSP deduction room and was not able to buy back her pension credits for the entirety of her maternity leave.

Ms. Moors asserted that the provisions of the Income Tax Act (ITA) requiring an individual to have RRSP contribution room in order to buy back pension credits relating to a maternity leave amounted to discrimination on the basis of gender and family status. Ms. Moors’s complaint was heard by the Canadian Human Rights Commission (CHRC), which dismissed the complaint.

The Federal Court held that the CHRC’s decision was reasonable and dismissed Ms. Moors’s appeal. The CHRC concluded that the tax rules relating to PSPAs did not amount to discrimination on the basis of gender or family status as the same tax consequences applied to anyone who required a PSPA. The court held that Ms. Moors’s inability to buy back pension credits accumulated during her maternity leave was related to an unfortunate incident of financial planning — Ms. Moors failed to make an election to purchase the credits by April 30 of the year following her return to work, as required by the OTPP — rather than a discriminatory effect of the ITA.

The court rejected Ms. Moors’s argument that the tax and PSPA rules pertaining to registered pension plans have a disproportionate adverse effect on women as only women take maternity leave. The court held that the ITA recognizes the significant effect of parental leaves on registered pension plans by allowing members to accrue pension benefits at a notional full-time equivalent rate for up to eight years. The court noted that eight years is three years longer than the time-frame permitted for other types of leaves and therefore the provisions governing registered pension plans are more sensitive to women who take maternity leave than members who take other forms of leave.

Federal Court Decision