It's Your Pension

Age 65

The normal retirement age under the OPSEU Pension Plan is 65. This is the age when you can retire with an unreduced pension if you do not qualify for unreduced early retirement options.

Early retirement with an unreduced pension: Factor 90 and 60/20

Currently, you may be eligible for an early unreduced immediate pension if you reach:

• Factor 90 – your age plus your pension service (in years and part years) total at least 90 years

• 60/20 – you are at least 60 years old and have 20 or more years of pension service.

If you qualify for one of the early retirement options, your pension will be calculated based on your pension service in the Plan on your termination date with no early-age reduction applied. The early unreduced retirement options include the CPP bridge pension which is payable until age 65.

Early age-reduced pension

You are eligible to retire with an early age-reduced pension if you do not qualify for other forms of early retirement and if you are over 55 but under 65 years old when you end your membership in the Plan. With this type of early retirement, your pension is calculated using the pension formula, including the CPP bridge up to age 65. Your lifetime pension and the CPP bridge benefit are subject to a reduction of five per cent for each full year you are under age 65. Partial years are prorated on the basis of full months.

Bridging to an unreduced pension

OPTrust members who receive a notice of layoff may be able to “bridge” to an unreduced pension. If you are laid off, please contact OPTrust.

Note that this type of bridging is different from the CPP bridge we discuss elsewhere in the booklet. For more information on bridging to an unreduced pension, see OPTrust’s fact sheet, Bridging to an Unreduced Pension or contact your employer, union representative or OPTrust.

Disability pension

To qualify for a disability pension you must be totally and permanently physically and/or mentally disabled, as defined in the Plan. To receive the disability pension you must apply to OPTrust, satisfy the above criteria and, if your application is approved, you must resign from your employment. You must provide medical evidence satisfactory to OPTrust, in order to receive the disability pension.

• If you have less than 10 years of pension service and membership you do not qualify for a disability pension. However, in some cases you may be eligible for a special disability refund under the Plan.

• If you have more than 10 years of pension service or continuous membership and your disability application is approved, your disability pension is payable immediately (i.e. the month following your termination of membership). Currently, the amount of your disability pension will be calculated using the pension formula with no early age-reduction applied.

If you start receiving your disability pension before age 65, it also includes a CPP bridge pension. As with all OPTrust pensions, the CPP bridge pension ends at age 65.

If your application for a special disability refund or disability pension is not approved, you are still entitled to a regular pension at 65, based on your pension service and salary. Taking an early age-reduced pension at age 55 is also an option.

Age 65: The CPP bridge ends

When you reach age 65, you are eligible to collect an unreduced pension from the CPP. At that point your CPP bridge pension from OPTrust ends.

You qualify for unreduced CPP

Your CPP retirement pension is payable when you turn 65. You must apply for it because it will not start automatically. There is a limit on the amount of your CPP pension you can collect retroactively.

The annual CPP benefits are adjusted every year to reflect changes in the cost of living. You can apply to start receiving your CPP retirement pension as early as age 60 but it will be reduced. If you delay starting your CPP pension past age 65, your CPP pension will increase. For details on CPP, please refer to Service Canada.

Note: The date you start your CPP pension does not affect the amount of your pension from the OPSEU Pension Plan. The formula under the Plan applies regardless of your decision regarding CPP. As well, the actual amount of your CPP pension will vary depending on your individual circumstances. This means that when the CPP pension bridge ends, the total amount of your pension from the OPSEU Pension Plan plus your CPP pension may differ from the amount you were receiving before the CPP bridge ended.

Old Age Security

In addition to CPP, you may be entitled to a monthly retirement benefit from Old Age Security (OAS). Your pension from the OPSEU Pension Plan is not adjusted due to OAS payments.

Questions about CPP and OAS?

To get more information about CPP and OAS go to the Service Canada website at servicecanada.gc.ca or call toll-free at 1-800-622-6232.

Currently, every January your pension or the pension of your survivor is adjusted for the increase in the cost of living. The adjustment is applied in January of the year after you start to receive a pension. The first adjustment is pro-rated for the length of time you received a pension in the previous year. The inflation adjustment reflects the increase in the cost of living in Canada (as measured by the change in the Consumer Price Index [CPI]) over two 12-month periods ending the preceding September.

The maximum increase in any one year is eight per cent. Any increase above eight per cent is rolled forward into the next year, to be used when the adjustment is less than eight per cent.

This chart shows how the inflation protection feature of the OPSEU Pension Plan works. The graph plots the growth of an average pension (that started at $29,800) over the 10-year period from 2007 – 2016.

If you are receiving a pension from the OPSEU Pension Plan and continue to work or start working again, whom you work for may affect your pension. If you work for an employer who does not contribute to the Plan, your pension is not affected. If you work for an employer who contributes to the Plan, there may be an impact on your pension depending on whether you rejoin the Plan.

Please contact OPTrust before you decide to work for an employer who contributes to the Plan. It is your responsibility to inform your employer that you are receiving a pension from OPTrust.

Without rejoining the Plan

Your pension is subject to a post-retirement earnings maximum each calendar quarter (e.g. January – March) if:

1. you are employed or re-employed by an employer who contributes to the Plan, and

2. you do not rejoin the Plan as a contributing member.

Your maximum quarterly re-employment earnings is determined when you start your pension by subtracting your gross quarterly OPTrust pension amount from three times your final monthly salary payable.

The maximum quarterly re-employment earnings is the amount you can earn with a contributing employer in any calendar quarter before we reduce your pension. This amount is provided on your Retirement Confirmation Statement when you retire, and your Pensioner Information Change Statement. If you are unsure of the limit, please call OPTrust. If your earnings exceed your maximum in any quarter, we will reduce your pension in the next quarter by the amount your post-retirement earnings have exceeded your maximum in the previous quarter.

Rejoining the Plan

Depending on your age and the nature of your employment or re-employment, you may have the option, or be required to rejoin the Plan. If you rejoin, your pension stops immediately and you will resume making contributions. While you are making contributions, you are accruing additional pension service so when your employment ends, we will recalculate your pension.

OPTrust recalculates your pension at the end of your re-employment period to include the additional pension service you accrued. However, if you were previously receiving an age-reduced pension, your new pension amount will be actuarially adjusted to take into account any pension payments you have already received.