It's Your Pension

Membership in the OPSEU Pension Plan will be either mandatory or optional, depending on your age and the terms of your employment. Eligibility for membership varies depending on an employee’s individual circumstances. If you are unsure whether or not you are eligible to participate in the Plan, please contact OPTrust directly – we are happy to help you.

Mandatory membership

Generally speaking, membership will be mandatory if you are less than 65 years old and

• you work for an Ontario government ministry or other employer as a regular full-time or part-time employee (including probationary employees) and are included in an OPSEU-represented bargaining unit whose members participate in the OPSEU Pension Plan, or

• you are a permanent employee of OPTrust, even if you are not part of the bargaining unit.

While enrollment in the Plan is automatic, you will be required to complete the necessary paperwork at date of hire.

Optional membership

Membership may also be optional for fixed-term (i.e. contract), seasonal or flexible part-time employees who are included in an OPSEU-represented bargaining unit whose members participate in the OPSEU Pension Plan. Eligible employees may join the Plan on or after their date of hire.

Membership may be optional for regular employees who are between the ages of 65 and 71 at the time of hire. However, your participation in the OPSEU Pension Plan must end by November 30th of the year you reach age 71, in accordance with the Income Tax Regulations.

If membership is optional for you and you decide to join, please speak to your employer and complete the Member Enrolment (OPTrust 1005) form.

Once a member

Regardless of whether your membership is mandatory or optional, once you join the Plan, you cannot end your membership until you terminate your employment or retire.

Building pension service

Pension service is the total period of time during which you contribute to the pension fund or have contributions made on your behalf. The amount of pension service you build up, or “accrue,” in the Plan depends on whether you work full time or part time. If you work full time, you accrue a full year of pension service in the Plan for each calendar year of employment.

Working part time

If you work part time, you accrue service in the Plan based on the percentage of time you work, compared to full-time employment. For example, if you work 50 per cent of full time, you accrue 50 per cent of one full-time year – or six months – of pension service in the Plan.

Special pension treatment for pre-retirement part-time employment

With the approval of your employer and subject to certain conditions, you may be allowed to switch from full-time to part-time employment within five years of retirement and obtain special pension treatment. After obtaining the consent of your employer you must submit your notice to your employer to retire within five years. This special provision lets you work part-time while making full-time contributions to the Plan so that you accrue full-time pension service. Under this provision, you cannot work full time after you have given notice to your employer, and you must retire upon reaching your chosen retirement date. Contact your employer to find out if you qualify for this provision.

If you become disabled, you may qualify for benefits under the long-term income protection (LTIP) provided by the Ontario Public Service, or an equivalent long-term disability plan. Your human resources or union representative can provide you with more information and let you know whether the benefit plan has been approved for purposes of the pension plan.

What happens if you qualify for LTIP?

Currently, if you qualify for a benefit under an approved LTIP (or equivalent long-term disability plan as determined by the Board) and do not resign from your employment, you continue to accrue pension service at your pre-disability rate. Your employer is required to make both their share and your share of contributions to the Plan on your behalf until you recover, resign from your employment, reach age 65, start your pension, or die (whichever occurs first). This also applies if you qualify for LTIP, but are paid directly by WSIB. Whether you qualify for LTIP is a decision made by your employer.

For pension purposes, if you qualify to receive LTIP, or qualify for LTIP but are paid by WSIB, the annual salary rate you were earning on the date of your disability is the base rate used for determining both your pension contributions and pension benefit. This “base rate” is currently adjusted each year based on the inflation adjustment applied to pensions, not the rate of pay in the collective agreement. For more details read the OPTrust fact sheet Long-Term Income Protection and Your Pension Contributions. Be sure to read about disability pensions, as well.

What happens if you only qualify for WSIB?

If you are paid directly by WSIB and do not qualify for LTIP, you have the option to accrue pension service by paying contributions to OPTrust during the period of your WSIB leave. You must complete the Application to Contribute for an Unpaid Leave of Absence (OPTrust 1025) form to advise OPTrust of your choice. If you choose not to contribute while on leave, under the current plan terms, you may apply to buy back the missed pension service after your leave has ended. If you apply within 24 months from the end of your leave, you may take advantage of the more favourable contribution-based costing option and employer matching contributions. If you apply more than 24 months after the end of your leave, an actuarial costing method is used and is often more expensive as you are then responsible for paying the full value of the pension service you are purchasing. For more details, refer to our fact sheet Contributing to Your Pension While on a WSIB Leave.

Transfers from other pension plans

The OPSEU Pension Plan has transfer agreements with many of the Canadian public and broader public sector pension plans. If you are joining the OPSEU Pension Plan and wish to transfer pension service, please notify OPTrust immediately. There are deadlines for transferring your service and we can inform you of the terms and any costs that may be involved. Please see the fact sheet Transferring Your Pension to OPTrust or contact OPTrust for a current list.

Transfers to other pension plans

If you are resigning from your current employment and taking a new job with an employer that is not part of the OPSEU Pension Plan, and your new employer contributes to any of the plans listed on our website, you may be able to transfer your OPTrust pension service to your new employer’s plan. If you want to transfer, please notify OPTrust and your new employer’s pension plan immediately, as there are specific deadlines for applying. Once you submit an application, OPTrust and your new plan’s administrator will handle the paperwork. To learn about transfers into and out of the OPSEU Pension Plan, please see our fact sheet on Transferring Your Credit into/out of the OPSEU Pension Plan or contact OPTrust.

Subject to certain limitations and provided you are under 55 years of age, you may also be able to move the commuted value of your pension to another pension plan, if the other plan will accept the transfer.

Transfers to the Public Service Pension Plan (PSPP)

There are special transfer arrangements between OPTrust and the Ontario Pension Board (administrator of the PSPP).

If you stay with your employer (and there is no break in employment service):

If you are in a bargaining unit position and transfer permanently to a non-OPSEU or management position with your current employer, you are no longer eligible to be a member of the OPSEU Pension Plan. When this happens, your accrued pension service is automatically transferred to the Public Service Pension Plan. We will process the paperwork for the transfer after your employer notifies us of the change in your position.

If you move to a new employer who is part of the PSPP (and there is a break in employment service):

When you end your employment in an OPSEU bargaining unit position and start employment in a non-OPSEU or management position with an employer that participates in the PSPP, your accrued pension service is not automatically transferred to the PSPP. The transfer of pension service is optional. You must notify us of your change in employment and desire to transfer your pension service to your new plan.

Impact on your pension entitlement:

Both mandatory and optional transfers of service between the OPSEU Pension Plan and the PSPP may have an impact on your pension entitlement. The PSPP and the OPSEU Pension Plan have different rules and benefits and the value of your pension service is different under each plan. You will be provided with information about how the transfer affects your pension entitlement when we are notified of the change in your position or your election to transfer your service to an employer who contributes to the PSPP.

Purchasing pension service (buybacks)

Under the current plan terms, as a member of the OPSEU Pension Plan you may purchase, or buy back, pension service in the Plan subject to certain eligibility criteria. Pension service is purchasable under the Plan for any of the following:

1. Past Ontario Public Service with any employer contributing to the OPSEU Pension Plan, the Public Service Pension Plan or its predecessor plan. This service includes periods of employment during which no contributions were made to the Plan (typically contract employment) and periods of employment for which contributions were previously refunded or for which you transferred your pension entitlement out of the Plan.

2. Past service with another Canadian registered pension plan: service with an employer who did not contribute to the Plan, but who offered employees a registered pension plan in Canada. The plan must be a registered defined benefit or defined contribution plan. Group RRSP or deferred profit-sharing plans (DPSPs) are not purchasable. During the period of employment, you must have been a member of that prior employer’s pension plan. For periods before 1992, you must still have pension service in your prior plan for the service you are purchasing, and you must transfer the funds directly to the OPSEU Pension Plan.

3. Leave of absence during which contributions were not made for more than one month for illness, including WSIB-compensated injuries, pregnancy, parental, adoption, special or educational purposes, or other leaves that qualify under the Employment Standards Act. You may accrue pension service for these periods by making contributions to the Plan during the leave, or you may apply to buy back these leave periods when you return to work.

4. Temporary part-time work arrangements with an employer who participates in the OPSEU Pension Plan (or the PSPP). You may accrue pension service for the hours you did not work by continuing to make contributions based on your regular hours during the arrangement. Alternatively, you can choose to make contributions on your reduced hours only and apply to buy back pension service for the hours you did not work when the arrangement ends.

Costs of buying back pension service

The cost of buying back is based on the type of pension service you are purchasing and when you apply. See the following chart:

Important notes:

• Even when a buyback is based on an actuarial value, there may be advantages to applying to buy back within the 24-month window. See our fact sheet Buying Back Pension Service for more information.

The cost can also differ depending on your individual circumstances. Some members may be subject to old rules. If this applies to you, OPTrust will inform you.

Payment options for your buyback include payments by:

• online banking or cheque for either lump sum or installment payments

• financing payments (where the cost is over $500) through payroll deductions for a period of up to 10 years or until termination of employment or membership, whichever occurs first

• transferring funds from your RRSP or LIRA, or

• any combination of these options.

Contributions made by cheque, online banking or payroll deduction are tax deductible.

For all purchases of pension service, you must have, or make available, sufficient RRSP room. Some purchases of pension service may require Canada Revenue Agency approval and may reduce your RRSP contribution room.

Note: To buy back prior service, the 24-month application window starts on the date of your enrolment in the Plan. For buying back leaves of absence periods or temporary part-time work arrangements, the 24-month application window starts on the day the leave or arrangement ends. The cost can differ depending on whether you apply within or outside the 24-month window. Refer to the fact sheet Buying Back Pension Service for information on deadlines and costs.

If your spousal relationship ends before retirement

If your spousal relationship ends, your spouse may become entitled to a portion of your pension accrued during your relationship as part of the equalization process under the Family Law Act. The Pension Benefits Act permits the payment of up to a maximum of 50 per cent of the pension earned during the period of the spousal relationship to your former spouse for the equalization of family property.

Before 2012

The laws governing the division of pensions upon spousal relationship breakdown changed in 2012. If you have a settlement document (i.e. court order, family arbitration award or domestic contract) dated before January 1, 2012 and it requires a division of your pension, the document must clearly identify how your pension is to be divided and you must file a certified copy with OPTrust. Your former spouse is not entitled to receive their share of your pension until you end your membership in the Plan.

After 2011

If your settlement document is dated on or after January 1, 2012, the law requires you to have your pension valued by the pension plan administrator (OPTrust), for equalization purposes. Please contact OPTrust for more information on obtaining this “family law value.”

Once you have received your “family law value,” and have finalized the equalization process, you must file a certified copy of your settlement document with OPTrust, if it gives your former spouse a right to a portion of your pension. Your former spouse has the option to transfer a lump sum amount into their locked-in retirement savings arrangement or pension plan (if allowed by that plan), in accordance with the settlement document, and subject to the 50 per cent maximum.

If you continue to work past the age of 65, you may choose to continue to contribute to the Plan and delay the start of your pension. However, by the end of November in the year you turn age 71, the Income Tax Act requires that you stop making contributions to a registered pension plan. So, your membership in and contributions to the Plan must end at this time and pension payments must begin.

If you work for an employer who participates in the Plan after you start receiving pension payments, there may be a reduction to your pension, depending on how much you earn. See what happens if you work after your pension starts.