Yesterday, Québec tabled its 2012-13 Budget (Budget). The Budget and its
accompanying paper, Quebecers and Their Retirement: Accessible
Plans for All, made a number of announcements regarding the
implementation of new "voluntary retirement savings
plans" (VRSPs). VRSPs appear to be Québec's version
of pooled registered pension plans. They were first announced last
year in Québec's 2011-12 Budget. (McCarthy
Tétrault's commentary on last year's budget is
Among other things, the Budget announced the following:
1.The Québec government will introduce VRSPs effective
January 1, 2013.
2.Employers with five or more employees (each of whom has had at
least one year of uninterrupted service) will have to offer a VRSP
by January 1, 2015, unless they already offer all their
employees the opportunity to contribute to a retirement savings
plan. Employers with fewer than five employees may, but do not have
to, offer a VRSP.
3.Employees with at least one year of uninterrupted service will
automatically be enrolled in a VRSP. However, these employees may
choose to withdraw from the VRSP within 60 days of their
4.As first proposed in the 2011-12 Budget, VRSPs will also be
open to, but not mandatory for, self-employed workers, business
owners and "individual savers."
5.Employer contributions will be voluntary. If made, employer
contributions will be exempt from payroll taxes, as is the case
with contributions to registered pension plans. VRSP participants
may set their own contribution rates and may elect to suspend
contributions. The default "employee" contribution rate
2% from January 1, 2013 to December 31, 2015;
3% from January 1, 2016 to December 31, 2016; and
4% as of January 1, 2017
6.Employer contributions will be locked in; however,
participants may withdraw their own contributions at any time,
subject to provincial and federal tax on withdrawals.
7.A VRSP's default investment option will be based on a
"life cycle" approach in which the risk level is adjusted
based on the participant's age. The VRSP may offer up to five
other investment options (for a maximum of six investment options
8.The Commission des normes du travail will be responsible for
overseeing employers' compliance with the VRSP legislation. The
Régie des rentes du Québec (Régie) will be
responsible for overseeing VRSP administrators.
9.VRSPs must be administered by a third party, such as a
financial institution or investment fund manager. Such an entity
must obtain a permit from the Autorité des marchés
financiers in order to administer a VRSP.
10.The VRSP administrator will have to show the Régie
that the management fees it charges are comparable to those of
institutional pension plans of similar size.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).