(A) Changes to the Federal PBSA
A number of changes to federal pension benefits standards legislation have been announced in the past number of months. Some of the announced changes are now in force while others have yet to come into force. Two notable changes will come into force on July 1, 2011:
- immediate vesting, and
- the application of the 50% rule to all periods of service i.e., even pre-1987 service.
OSFI has summarized the federal legislative changes in a document entitled “Key PBSA/PBSR Amendments and In Force Dates”.
(B) Changes to the Ontario PBA
On May 12, 2011 the 2011 Ontario Budget bill, Bill 173 received Royal Assent. Section 35 of that bill incorporates amendments to the PBA. One amendment provides that a former member of a pension plan, who terminates employment or ceases membership and is entitled to a deferred pension, can no longer require the administrator to purchase an annuity unless the pension plan permits such an option. The Superintendent has also been given the authority to require an administrator to provide specified additional information and documents within a specified period to those entitled to notice of an intended wind up. As well, a new section specifically addressing the wind up of the Nortel pension plans has been added to the PBA. Other amendments contained in Bill 173 will come into force upon proclamation.
A number of provisions contained in Bill 120 (sections 1(9), 3(3), and 16) related to jointly sponsored pension plans were proclaimed in force on June 1, 2011. Also, amendments to Regulation 909 under the PBA with respect to jointly sponsored pension plans were filed on May 20, 2011.
Another regulation was filed on May 20, 2011 that provides solvency funding relief for certain public sector pension plans.