The federal government has amended the pension fund investment
rules under Schedule III to the Pension Benefits Standards
Regulations, 1985. The change came into effect on July 1,
According to the Regulatory Impact Analysis Statement,
modernization of the investment rules is part of the federal
government's measures to strengthen and improve the legislative
and regulatory framework for federally regulated private pension
plans on a permanent basis. The change aims at providing more
flexibility for plans to choose the investment options that best
suit their investment needs and adopting flexibile, prudent and
effective principles-based investment rules.
Removal of Quantitative Limits on Resource and Real Property
Prior to the amendment, the investment of the pension fund of a
federally regulated private pension plan in real property and
Canadian resource properties was subject to 5%, 15% and 25%
quantitative investment limits. These quantitative limits are now
The removal of these quantitative limits is a welcome change for
the modernization of the pension fund investment rules. The impact
statement indicates that there will be more changes to the
investment rules but it is unlikely that all of the current
quantitative investment limits (e.g., the prohibition on a pension
fund holding more than 30% of the voting shares of a single entity)
will be removed.
This change to the federal investment rules will not only affect
federally regulated private pension plans; it will also affect
pension plans governed by the provincial pension legislation which
has adopted the federal investment rules, as amended from time to
time. These jurisdictions are Alberta, British Columbia, Manitoba
The changes will not affect pension plans governed by the New
Brunswick and Quebec pension legislation (as they have different
investment rules) or pension plans governed by the Ontario, Nova
Scotia or Newfoundland and Labrador pension legislation, without
conforming changes to their investment rules.
As a note of caution, even for pension plans in the
jurisdictions affected by the change, the investment of pension
funds may still be subject to the 5%/10%/25% limits if these limits
are included in the pension plan's statement of investment
policies and procedures and are not removed.
In Shirbigi v. JM Food Services Ltd. (2014 BCSC 1927), the B.C. Supreme Court found that an employer could not mask the fact that it had constructively dismissed the plaintiff simply by relocating her place of work.
In the recent decision of Cape Breton (Regional Municipality) v CUPE, Local 933, 2014 NSSC 97, the Nova Scotia Supreme Court upheld an arbitrator's decision to conditionally reinstate an employee who had been terminated due to excessive absenteeism.