Canada: Nova Scotia Human Rights Tribunal Looks At Mandatory Retirement

Last Updated: June 20 2014
Article by Lisa Gallivan and Alison Strachan

Recently in Foster v. Cape Breton (Regional Municipality), 2014 CarswellNS 370, the Nova Scotia Human Rights Tribunal ("the Tribunal") looked at a complaint of age discrimination of a worker who was forced to retire after 65 years based on a defined contribution plan.  The following is a summary of how the Tribunal reached its decision that requiring retirement at 65 was bona fide in the circumstances.

What happened?

The complainant worked for the municipality from 1995 to 2012 when he was required to retire after turning 65 years old. The Nova Scotia Mandatory Retirement Act came into force on July 1, 2009.  The Municipality amended its defined contribution plan ("DCP") to include retirement at age 65 shortly before July 1, 2009. Although the Municipality asked its plan administrator to register the amendment, this did not happen until June 2012.

The complainant alleged age discrimination based on the DCP not being a bona fide pension plan as of the date of his required retirement (June 30, 2012).

What did the Tribunal say?

The Tribunal found the DCP was a bona fide pension plan at the date of the complainant's retirement; the amendment was done in good faith for valid reasons and was not done with the intent of defeating protected rights under the Human Rights Act. The Tribunal found that the DCP was a proper exception to the prohibition against age discrimination under section 5(h) of the Human Rights Act. The following are key passages from the decision:

62.       For the purpose of assessing the challenge the Board accepts that the DCP meets the objective test of the assessment set out in Potash, supra. Registration of the amendment under the Pension Act is only one consideration. The DCP is a bona fide plan from all other measures. It is well-funded, registered for purposes of the Income Tax Act and has a significant number of members. As mentioned, the roots of the plan extend into various municipalities before the incorporation of CBRM. The Board rejects the suggestion the registration issues of the amendment is evidence that the DCP is a 'sham'. There is considerable evidence of sloppiness on the part of Sun Life and CBRM, but that is not enough to cause the Board to question the bona fide plan as amended. The Superintendent has approved the amendment with full disclosure of its effect.


80. To arrive at the conclusion the Commission advances that the spirit, purpose and goal of the MRA was violated by CBRM, one would have to ignore ss. 6 (g). One would also have to ignore the complexity of the issue as it has been discussed and debated for a long time. In this instance, the Board fails to see how CBRM's exercise of a right contained within the Act can be seen as an attempt to defeat the Act. The Board sees that CBRM exercised a right that is available to it under the legislative framework and was not focused on thwarting Mr. Foster or other employees situated like him.

81. In order to invalidate the June 16, 2009 amendment one would have to introduce some assessment of its merit. For example, it may be of some concern to the Board that there was no offsetting compensation or benefit to employees like Mr. Foster who had this new term introduced to the DCP. However, that level of analysis is what the Potash decision directs ought not to be done. The analysis does not change simply because it is an amendment to the Plan. It is not the role of the Board to review each term and condition as to its merit, rather the Board must look only at the pension plan in its totality. From the larger perspective, the DCP was a bona fide pension plan as of June 30, 2012 and is a full answer to Mr. Foster's complaint.

82. In conclusion, it is the view of the Board that the DCP as it existed on June 30, 2012 constituted a bona fide pension plan as contemplated by ss. 6 (g) of the Act. Accordingly, the mandatory retirement provision in the DCP is a proper exception to the prohibition against age discrimination pursuant to Section 5 (h) of the Act and Mr. Foster's complaint must be dismissed.

What does this mean to you?

This decision confirms that any analysis of a retirement "age" requirement must look at the pension plan in its totality and not by simply reviewing the merit of each term and condition. A requirement to retire at 65-years of age by a well-funded registered plan with a significant number of members that an employer intends to treat equally is not the type of plan that will be an issue. Although there was a degree of sloppiness in the registration of the amendment requiring retirement, the circumstances did not amount to what the Commission argued in this case, was a "sham".

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.

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Lisa Gallivan
Alison Strachan
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