Prepared by:
- Level Chan and Dante Manna, Stewart McKelvey
- Heather Di Dio, Dentons
- Francois Parent, Lavery, De Billy LLP
- Allison Tremblay, Victory Square Law Office LLP
- Michael Wolpert, Lawson Lundell LLP
(a) Ontario Retirement Pension Plan
On May 5, 2015, Bill 56: Ontario Retirement Pension Plan Act, 2015 received royal assent. Bill 56 requires the Ontario government to establish the Ontario Retirement Pension Plan (ORPP ) by January 1, 2017 and forms the foundation of the plan. Further details on the ORPP were released on August 11, 2015. Employers and employees who participate in a comparable pension plan, including defined benefit and defined contribution pension plans that meet certain minimum thresholds, will not be required to participate in the ORPP . Enrolment in the ORPP will be staged in four waves from 2017 to 2020. Contribution rates will be phased-in with all participating employers and employees contributing 1.9% each by 2021. The Ontario government’s goal is for every Ontario employee, including the self-employed, to be part of the ORPP or a comparable workplace pension plan by 2020.
To access the full text of Bill 56, visit: http://www.ontario.ca/laws/statute/s15005. To access information on the ORPP from the Ministry of Finance website, visit: http://news.ontario.ca/opo/en/2015/08/premier-releases-details-of-ontario-retirement-pension-plan.html.
(b) Pooled Registered Pension Plans
On May 28, 2015, Bill 57: Pooled Registered Pension Plans Act, 2015 received royal assent. Bill 57 creates a framework for the creation of pooled registered pension plans (PRPPs) in Ontario. PRPPs are pension plans designed to offer a low-cost tax-assisted retirement savings option for employees and the self-employed. Participation in PRPPs is voluntary for employers. To access the full text of Bill 57, visit: http://www.ontla.on.ca/web/bills/bills_detail.do?locale=en&Intranet=&BillID=3093.
(c) Statement of Investment Policies and Procedures (SIPPs)
Starting January 1, 2016, administrators of Ontario-registered pension plans must file their SIPPs and SIPP amendments with the Financial Services Commission of Ontario (FSCO) based on the following timeline:
For plans registered before January 1, 2016, the SIPP must be filed by March 1, 2016.
For new plans registered on or after January 1, 2016, the SIPP must be filed within 60 days after plan registration.
Amendments to a SIPP must be filed within 60 days after the date the amendment is made.
The content requirements of a SIPP are set out in the federal investment regulations, as modified by the Pension Benefits Act. Beginning in 2016, SIPPs must state whether environmental, social and governance factors are incorporated into the plan’s investment policies and procedures, and if so, include a description of how those factors are incorporated. On August 7, 2015, FSCO released new and revised FAQs regarding SIPPs and related disclosures. To review the updated FAQs, visit: http://www.fsco.gov.on.ca/en/pensions/legislative/Pages/sipp.aspx#RevJuly.
The SIPP changes are set out in O.Reg 235/14 made under the Pension Benefits Act, which was filed on November 27, 2014. To access the regulation, visit: http://www.ontario.ca/laws/regulation/r14235.
(d) Biennial Former Member and Retired Member Statements
Section 27(2) of the Pension Benefits Act, as amended by Bill 236: Pension Benefits Amendment Act, 2010, came into force on January 1, 2015. It requires plan administrators to provide statements to retired members and former members every two years. The content of those statements is set out in O.Reg 235/14 made under the Pension Benefits Act, which was filed on November 27, 2014. To access the regulation, visit: http://www.ontario.ca/laws/regulation/r14235.
(e) FSCO Investment Guidance Notes
FSCO has released two draft investment guidance notes for public consultation: (i) IGN-003 on Statement of Investment Policies and Procedures (SIPPs) for Member Directed Defined Contribution Plans and (ii) IGN-004 on Environmental, Social and Governance Factors. The documents set out FSCO’s expectations of plan administrators relating to the investment of pension plan assets and investment-related obligations. The deadline for submissions for both investment guidance notes is August 28, 2015.
Earlier this year, FSCO also released IGN-001 on Buy In Annuities for Defined Benefit Plans and IGN-002 on Prudent Investment Practices for Derivatives. All of the investment guidance notes are accessible at: http://www.fsco.gov.on.ca/en/pensions/fsco_consultations/Pages/investment-guidance-notes.aspx.
(f) Target Benefit Plans
The Ontario government released a consultation paper on Target Benefit Multi-Employer Pension Plans (MEPPs). Interested parties are invited to provide feedback regarding the consultation paper and how best to implement a target benefit MEPP framework in Ontario. Submissions are due September 25, 2015. To access the consultation paper, visit: http://www.fin.gov.on.ca/en/pension/mepp.html.
(g) Multi-jurisdictional Pension Plan Amendments
In light of the recent changes to Alberta’s and British Columbia’s pension standards legislation, plan amendments for Ontario-registered multi-jurisdictional pension plans that have Alberta and British Columbia members are required to be filed with FSCO by December 31, 2015. For more information, visit: http://www.fsco.gov.on.ca/en/pensions/pages/mjpp-amendments-alberta.aspx.