On May 2, Minister of Finance Charles Sousa tabled the Ontario
Liberal government's 2013 Budget. The Budget contains a number
of announcements relating to pensions and benefits that will be of
interest to Ontario employers, pension plan administrators and
Chief among these, the Budget commits the government:
To increase the Employer Health Tax (EHT) exemption from
$400,000 to $450,000 of payroll, beginning in 2014 (a measure of
relief for small businesses), which will be further adjusted for
inflation every five years. The government also proposes to better
target the exemption by eliminating it for private-sector employers
with annual payrolls over $5 million.
To a consultation on introducing "pooled registered
pension plans" (PRPPs) in Ontario. First introduced for
federally regulated workplaces in December 2012, these arrangements
are large-scale, defined contribution pension plans administered by
a licensed, independent third-party administrator. The Budget
indicates that PRPPs would be optional for employers and employees
as well as the self-employed, as they are federally.
To amend the Pension Benefits Act (PBA) to respond to
the Ontario Court of Appeal's October 2012 decision in Carrigan v. Carrigan Estate. It would
appear that the government has committed to overrule the decision
through a legislative amendment, although the Budget does not
actually say as much.
Finalize regulations under the PBA governing new financial
hardship unlocking rules, pension asset transfers and disclosure
requirements to former and retired members of pension plans. The
Budget does not commit to a specific timeline for finalization. The
regulations are required in order for amendments to the PBA passed
in 2010 to come into force.
To create a working group to move ahead with pooled asset
management for public sector plans, first recommended in the Morneau Report released in November 2012.
To develop a framework for single-employer target benefit plans
and to finalize regulations governing amendments to the PBA on
multi-employer target benefit plans passed in 2010. Under a target
benefit plan, the administrator may reduce accrued benefits if the
plan is underfunded, in contrast to a traditional single-employer
defined benefit pension plan, under which benefits cannot be
To develop a framework for contribution holidays for pension
plans, including disclosure requirements to plan stakeholders.
To create a working group to consider the sustainability of and
issues facing pension plans in the electricity sector.
The full Budget document and backgrounders are available on the
Ministry of Finance's website. Note that
the Budget still remains subject to passage in the Legislature,
which is by no means certain given the current minority
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.
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