Last December 3, the National Assembly of Québec enacted the Act respecting voluntary retirement savings plans.
What obligations do employers have in respect of these new voluntary retirement savings plans (VRSP)?
First: no employer will be required to contribute to these plans. However, employers with a minimum of five employees will be required to offer a VRSP unless they already offer a registered retirement savings plan (RRSP) or a tax-free savings account (TFSA), or employees benefit from a registered pension plan.
In order to offer a VRSP, employers will need to select an administrator depending on the products on offer. They must notify their employees that a VRSP has been created. Finally, employers will need to register employees in the plan, deduct contributions from payroll and send them to the VRSP's administrator.
The law comes into force on July 1, 2014, but the deadline for putting a VRSP in place differs for each employer based on the number of eligible employees. To be eligible, an employee must be at least 18 years old, and be credited with one year of uninterrupted service with the employer.
Click here to view table.
Employees are free to renounce participation in the plan by means of an official declaration. Employees who prefer to take part in this plan may determine and control the value of their contributions.
VRSPs are registered with the Régie des rentes du Québec. The plans are administrated by insurers, by investment fund managers or by trust companies, licenced by the Autorité des marchés financiers.