Employers that provide registered pension plans to their Ontario
employees should review their Statement of Investment Policies and
Procedures ("SIPPs") within the next few months.
New Ontario SIPP requirements are coming into force: SIPPs
will have to be filed with the Ontario pension regulator, and they
will have to address new issues described below.
Electronic filing of SIPPs with the Ontario regulator will be
mandatory in 2016. You shouldn't assume that your
pension service provider will attend to the filing for you.
It's the legal responsibility of the registered administrator
of the plan – usually the employer – to ensure that the
SIPP is adopted and filed on time. For most plans, the filing
deadline is March 1st, 2016.
There is no change to the requirement that SIPPs be reviewed and
confirmed, or amended, at least annually. If your company has
not yet conducted its 2015 SIPP review, now is the time to become
familiar with the new SIPP requirements and address them as part of
your 2015 review. Doing so will avoid having to do another
review in early 2016.
Under the new rules SIPPs must state whether environmental,
social and governance ("ESG") factors have been
incorporated into the pension plan's investment policies and
procedures and, if so, how those factors were incorporated.
There is no legal or standard definition of "ESG
factors". On June 30th the Ontario regulator released
draft "Investment Guidance Notes" (here) which provide background
information on the new rules. Notably, the regulator expects
the administrator to "establish and document its own view or
understanding on what is meant by ESG factors" and
"consider whether or not it will incorporate ESG factors and
document the basis for its decision." The regulator
expects such documentation to appear in meeting minutes or in an
SIPPs for defined contribution ("DC") registered
pension plans will have to contain a significant amount of new
information. The Ontario regulator released a separate draft
"Investment Guidance Note" (here) for "Member Directed Defined
Contribution Plans". It lists eight categories of
information that should be included in SIPPs for DC plans,
including the requirement to disclose how investments are selected,
communicated and monitored. Most interesting is the proposed
requirement that the SIPP specify "the frequency and type of
reporting" that the administrator will require from the
plan's service providers. The regulator provides an
example: the SIPP may have a statement that quarterly
reporting will be provided by the record keeper on fund
performance, fund allocation, web-site usage, and other
service-level statistics. This level of disclosure regarding
monitoring of service providers should cause administrators to take
a fresh look at how they govern their DC plans.
The Ontario pension regulator has invited public submissions on
both of its draft Investment Guidance Notes. All feedback
will be made public. Click here for information about how to comment on
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Ten days following the election, join us for a discussion with Gary Doer, former Canadian Ambassador to the US, and Gordon Giffin, US Ambassador to Canada under Bill Clinton, to discuss how the new President and Congressional makeup will shape US-Canada relations for years to come.
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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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