Delays in the commencement of pension benefit payments to a
member or his/her survivor sometimes inadvertently occur. In these
circumstances, the obvious remedy is for a lump sum catch-up
payment to be made out of the pension plan on account of the missed
pension benefits. Such a payment in lieu of regular benefits,
however, is problematic under the income tax rules. Among other
things, it results in the plan not being administered in accordance
with its terms as registered and also breaches the rule that
pension benefits be paid in "equal periodic amounts". It
has been the longstanding administrative position of Canada Revenue
Agency's Registered Plans Directorate ("RPD") that in
appropriate circumstances it will provide administrative relief for
lump sum payments of this nature but on a case-by-case basis only.
The process to date has required plan administrators to submit a
written request to RPD in each instance that a plan member is owed
missed pension benefits and to await RPD written approval prior to
making the lump sum catch-up payment. While RPD has generally
provided the necessary administrative relief where the delay was
beyond the control of the particular member, the need to apply for
administrative relief in every instance is cumbersome and
RPD has recently announced that it is considering a significant
change to the administrative relief process for lump sum payments
representing missed pension benefits. In particular, RPD is
considering allowing lump sum catch-up payments to be made without
its prior approval, provided that the particular registered pension
plan provides RPD with a report setting out certain specified
details regarding the catch-up payments made from the pension plan
during a calendar year. The report must be submitted to RPD not
less than annually. In cases where there has been a delay in
commencing payment for plan members beyond age 69 or 71 (depending
on the terms of the plan, and the years in question), RPD will
continue to require a written request for its approval.
This announcement by RPD is welcome news for the pension
industry. The new process, once implemented, will reduce the
administrative burden for pension plan administrators and eliminate
the delay in making the catch-up payment to the member. RPD has
indicated that it welcomes any comments from the pension industry
on the proposed new approach. Comments should be sent to RPD prior
to May 29, 2009 by email to firstname.lastname@example.org.
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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