Proposed regulations in connection with Ontario "pension
advisory committees" will bring forth new obligations for
pension plan administrators. Employers take note – the
deadline to comment on such regulations is fast approaching:
September 12, 2016.
Pension Advisory Committees
Pension advisory committees ("PA Committees") are
committees made up of member and retired member representatives.
The members of a pension plan, by the decision of a majority of
them participating in a vote, may establish a PA Committee.
The purposes of a PA Committee are to monitor, and make
recommendations to the administrator regarding, the administration
of the plan, and to promote awareness and understanding of the plan
to applicable persons.
Although the ability to establish PA Committees has been in the
legislation for some time, PA Committees have generally not been
common. This may be because PA Committees historically were not
entitled to receive much (if any) assistance with setting up the
committee or the costs related for such a committee. However, that
state of affairs will change shortly. Plan administrators should be
aware of this.
Recent Developments on PA Committees
Bill 236 (Pension Benefits Amendment Act, 2010)
contained amendments to the advisory committee sections in the
Pension Benefits Act (Ontario). These amendments have not
yet come into force, pending regulations to support them.
The first draft of those regulations was released in August 25,
2015 and comments were due on October 13, 2015. Very recently, on
August 22, 2016, an amended draft of those regulations was
released. Comments on this amended draft are due on September 12,
The Amended Draft Regulations
For the most part, the amended draft regulations did not
materially change the first draft of the regulations. Some of the
key points that the amended draft regulations prescribe are as
requirements related to a required notice of intent to
establish a PA Committee (in order to establish such a committee),
such as the minimum threshold of people that must provide such a
notice, the contents of such notice and the timeframe the
administrator has to discuss such notice with the applicable
the minimum number of members in a pension plan in order to
establish a PA Committee;
the timeframe that the administrator has to, among other
things, distribute the ballot for voting (which is 90 days after
receiving the notice, from 60 days after receiving the notice in
the first draft of the regulations);
the methods for a secret ballot vote (which were not present in
the first draft of the regulations);
requirements for the administrator to notify all applicable
persons of the outcome of the vote and if a vote is successful, the
minimum (four, from five in the first draft of the regulations) and
maximum number of representatives appointed in accordance with the
requirements for the administrator to take certain actions
after the representatives of a PA Committee have been appointed,
including ensuring they have access, at least annually, to an
individual who can report on the fund's investments and discuss
the administration of the pension plan and matters of interest to
beneficiaries at meetings to be held at least twice per year,
unless the PA Committee determines that one meeting is sufficient
in any given year (the latter of which was not included in the
first draft of the regulations);
payment out of the pension fund of reasonable costs associated
with holding a vote to establish a PA Committee and related to the
PA Committee's establishment and operation; and
not requiring the administrator to provide the assistance
described in the amended draft regulations for three years (from
two years in the first draft of the regulations) after the date of
the most recent unsuccessful vote.
Deadlines and New Obligations
For employers who did not make submissions on the first draft of
the regulations or who would like to make comments on the amended
draft regulations, the deadline is September 12, 2016. Since these
regulations will likely affect some plans, employers may choose to
make submissions on the amended draft regulations.
Once the regulations are finalized, it is expected that the new
PA committee provisions in the Pension Benefits Act
(Ontario) will also be proclaimed into force. Once that happens,
plan administrators will need to be able to respond appropriately,
with the new provisions and regulations in mind, with respect to PA
committee related matters.
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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