In April 2013, Alban d'Amours, as president of the committee
of experts charged with studying the situation of supplementary
pension plans in Quebec, published his report on the future of
Quebec's retirement system (the d'Amours Report). The
d'Amours Report contained 21 recommendations divided into three
sections: the creation of a longevity annuity, modifications to the
legislative regime for defined benefit (DB) pension plans and
On December 12, 2013, the Minister of Labour and Employment,
Agnès Maltais, announced that following the d'Amours
Report, the Government of Quebec has decided to prepare a plan of
action to correct and redress the situation of DB pension plans in
Quebec as quickly as possible. This bulletin aims to outline this
plan of action.
OBJECTIVES OF THE PLAN OF ACTION
The plan of action announced by the Quebec government contains
Studying the proposal made by the d'Amours Report to create
a longevity annuity that would offer a DB annuity to all Quebec
workers starting at the age of 75
Making it obligatory that the employers and the active
participants share the costs equally for future services in
public-sector pension plans
Overhauling the financing rules for pension plans in both the
private and public sectors (including the adoption of the financing
method based on the concept of enhanced funding in the private
Negotiating an agreement between employers and participants
concerning the restructuring of pension plans in both the private
and public sectors.
These objectives must be realized while taking into
consideration the four guiding principles established by the
government; namely, intergenerational equity, the protection of the
income of retirees, the accuracy of the costs of pension plans and
the capacity of taxpayers to pay for the public-sector plans.
NEGOTIATION PROCESS FOR AGREEMENT TO RESTRUCTURE THE PENSION
To facilitate the restructuring of the plans, the government
foresees a negotiation process that will last for two years and
which will unfold in three stages.
First, the government foresees the creation of three working
groups: one for the private sector that will comprise employers and
unions, one for the municipal sector and one for the universities.
These three groups will have four months to determine the measures
to implement concerning the financing rules for DB pension plans,
to propose the parameters that will frame the negotiation of the
agreement concerning the restructuring of the plans, and to
establish the terms that will guide the decision of the Commission
des relations du travail (the CRT) if it must intervene to settle
disagreements related to the negotiation of the agreement.
A negotiation period of six months will follow during which the
different parties involved must reach an agreement regarding the
restructuring of DB pension plans.
If the parties do not achieve an agreement by the end of the
negotiation period, the government's plan of action provides
for a two-phased process for settling disagreements. A conciliator
under the Minister of Labour could be named for a period of six
months to help the parties reach an agreement. If no agreement is
reached by the end of this period, the CRT could intervene to
resolve the differences between the parties. The CRT could appeal
to specialists at the Régie des rentes du Québec to
validate the proposals made.
BILLS TO BE TABLED IN 2014
As part of its plan of action, the Government of Quebec foresees
tabling two bills in 2014. The first bill, to be tabled in the
spring of 2014, will focus on the duration of the restructuring
period for DB pension plans, the parameters framing the process for
resolving disagreements during the negotiation of the agreement on
the restructuring of the pension plans, and the terms that will
guide the decisions of the CRT should it need to resolve
The second bill will be tabled in the fall of 2014 and will deal
with, among other things, the financing methods of DB pension plans
and other recommendations from the d'Amours Report on the
financing of supplementary pension plans. These two bills will be
the object of public consultations.
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