Effective January 1, 2015, the Ontario Pension Benefits Act (“PBA”) was amended to require plan administrators to provide information statements to all former and retired members every two years. Administrators of plans registered with the Financial Services Commission of Ontario (“FSCO”) on or before January 1, 2015, were required to provide the first set of such statements by no later than July 1, 2017. Many plan administrators in Ontario are now going through the process of providing the second set of such pensions statements and will be required to do so by July 1, 2019. In this blog post, we review the disclosure requirements and consider what plan administrators can do when former or retired members cannot be found.
Content of statement
The required content of the information statements is prescribed under the Regulations to the PBA. For former members, this includes: information about the pension plan, pension benefits, ancillary benefits and retirement dates; spouse and beneficiary information; funded status of the pension plan; an explanation about any amendments made during the period covered by the statement that has not been previously provided to the former member; and certain information about the plan’s statement of investment policies and procedures. For retired members, this includes: information about the pension plan, pension-in-pay and ancillary benefits; spouse and beneficiary information; funded status of the pension plan; an explanation about any amendments made during the period covered by the statement that has not been previously provided to the retired member; and certain information about the statement of investment policies and procedures.
Missing former and retired members
Many plan administrators that went through the process of preparing and issuing information statements to former and retired members in 2017 discovered that certain individuals could not be located. The same issues will undoubtedly arise again in 2019. According to FSCO policy, if a plan administrator does not have current contact information for a former or retired member, the administrator should conduct an individual search for updated contact information. In Policy A300-900, Searching for Plan Beneficiaries, FSCO identifies examples of search methods. These include: a registered letter to the last known address; internet and social media sites; and professional search companies.
If the plan administrator cannot locate a former or retired member for the purpose of issuing the information statement, it may choose to apply to the Ontario Superintendent of Financial Services for a waiver of the requirement to provide the statement. If the administrator wishes to apply for such a waiver, it should do so before the statement deadline; the waiver will not be retroactive to the statement date. The waiver application must, among other things, address the search efforts the administrator has undertaken in trying to find the former and retired members. FSCO Policy A300-901, Waiver of Biennial Statements for Missing Former and Retired Members, sets out FSCO’s expectations with respect to the waiver application.
Under the PBA, a plan administrator is not required to apply for a waiver of the requirement to provide a statement to former and retired members. If the administrator does not wish to apply for a waiver, it should ensure that it has undertaken a reasonable and appropriate search for the former and retired members and has documented those search efforts. It is FSCO’s position that a plan administrator has a duty to make reasonable efforts to locate missing former and retired members in a timely manner.