Retroactive wage increases have been confirmed affecting various bargaining unit employees including Ontario Public Service Unified, Correctional Services, and LCBO among others.
What to expect
OPTrust is working closely with employers to receive updated salary information and pension contributions for all members of the OPSEU Pension Plan impacted by the award. The timing of when OPTrust receives this information may differ by employer, resulting in varying timelines for members to see adjustments to their pension benefits.
Over 61,000 members and former members are currently impacted with up to three years of retroactive earnings/salary data to be updated. We kindly ask for your patience as we recalculate and process the volume of adjustments to pension benefits.
Next steps
Employers and OPSEU/SEFPO come to an agreement on retroactive salary increase amounts.
Employers make retroactive salary payments to impacted employees and deduct applicable pension contributions.
Employers provide retroactive salary information and pension contributions to OPTrust.
OPTrust updates member records with retroactive salary increases and contributions, and recalculates pension benefits, where applicable.
Members who are still working
There is nothing you need to do if you are still working. Your records will be updated once we receive and process the data and contributions from your employer.
Members getting ready to retire or leave the Plan
If we have not received updated data from your employer, we will continue to process your request without delay, and will reach out to you directly if your pension benefit has changed due to the retroactive salary increases.
Members who have left the Plan
For impacted members who have terminated their membership in the Plan, including those who have transferred their entitlements out of the Plan, we expect to recalculate your pension benefit starting in fall 2024. We will reach out to you directly to inform you of any resulting changes to your pension benefit. Due to the timing of when data is expected from each employer and the high volume of recalculations, we anticipate this process will extend into 2025.
Retired members
For retired members who are impacted, we expect to recalculate your pension starting in fall 2024 and you will receive information regarding your updated monthly pension amount, as well as any retroactive lump sum amount payable. Due to the timing of when data is expected from each employer and the high volume of recalculations, we anticipate this process may extend into 2025.
2023 Annual Pension Statement (APS)
Your 2023 APS will not reflect retroactive salary increases, as the necessary data was not received prior to preparing these statements. If you are eligible for retroactive salary increases, changes are expected to be reflected in your 2024 Annual Pension Statement, which will be issued in 2025.
Questions about your retroactive salary payment?
Please contact your pay and benefits representative for questions regarding your retroactive salary payment.
Keep us updated
If your contact information has changed since you retired or left the Plan, please reach out to OPTrust to ensure your information is up to date. We will be contacting impacted members.
FAQs
Read answers to frequently asked questions if you are a member or retiree affected by retroactive salary increases.
Members
No. Currently, online pension estimates cannot be calculated for members affected by retroactive salary increases. This is because in most cases OPTrust has not received new salary information and pension contributions from your employer. The timing for receiving this information varies by employer and will extend to 2025. As a result, OPTrust is unable to calculate a pension estimate until we process the updated information. Once we have updated your record with the revised financial information from your employer, you will be able to produce a pension estimate through your Online Services account.
No. Currently, online pension estimates cannot be calculated for members affected by retroactive salary increases. This is because in most cases OPTrust has not received new salary information and pension contributions from your employer. The timing for receiving this information varies by employer and will extend to 2025. As a result, OPTrust is unable to calculate a pension estimate until we process the updated information. Once we have updated your record with the revised financial information from your employer, you will be able to produce a pension estimate through your Online Services account.
If you have already received a Pension Options package (or Termination Options package) and have returned your election to have your entitlement transferred out of the Plan, we expect to start recalculating pension benefits starting in fall 2024 for this group. Once completed you will receive a Payment Options package to select how your additional pension benefit is to be paid out. The payment options available will be detailed in your package, and depending on the amount, the funds may be transferred on a locked in basis to your registered retirement savings plan (RRSP) or paid as cash subject to withholding taxes.
If you have already received a Pension Options package (or Termination Options package) and have not yet returned an election or have elected to defer your pension, we expect to start recalculating pension benefits in 2025 for this group. Your increased deferred pension will be reflected in your Annual Pension Statement once OPTrust has received and processed the data and contributions from your former employer.
If you have already received a Pension Options package (or Termination Options package) and have returned your election to have your entitlement transferred out of the Plan, we expect to start recalculating pension benefits starting in fall 2024 for this group. Once completed you will receive a Payment Options package to select how your additional pension benefit is to be paid out. The payment options available will be detailed in your package, and depending on the amount, the funds may be transferred on a locked in basis to your registered retirement savings plan (RRSP) or paid as cash subject to withholding taxes.
If you have already received a Pension Options package (or Termination Options package) and have not yet returned an election or have elected to defer your pension, we expect to start recalculating pension benefits in 2025 for this group. Your increased deferred pension will be reflected in your Annual Pension Statement once OPTrust has received and processed the data and contributions from your former employer.
Retired members
Generally speaking, your pension should be positively affected by your retroactive salary increase. However, the amount of your pension increase will depend on whether your salary increase impacted your best five-year average salary. The average salary is the average of your highest sequential 60 months of salary based on your annual full-time salary rate, not including overtime or bonuses. Below, we have provided an example to illustrate a member’s pension increase.
Note: The actual increase amount will vary depending on your five-year average salary and years of service.
Example:
Termination of employment occurred in 2023. The average Year’s Maximum Pensionable Earnings (YMPE) is $61,840.
Original five-year average salary = $78,000.00
Revised five-year average salary = $79,300.00
Years of service = 10
Lifetime pension = 2% x average salary x years of service less bridge benefit
Bridge benefit = 0.655% x [lesser of average YMPE or average salary] x years of service
The result of the increase for this retiree’s pension is $21.67 per month.
Generally speaking, your pension should be positively affected by your retroactive salary increase. However, the amount of your pension increase will depend on whether your salary increase impacted your best five-year average salary. The average salary is the average of your highest sequential 60 months of salary based on your annual full-time salary rate, not including overtime or bonuses. Below, we have provided an example to illustrate a member’s pension increase.
Note: The actual increase amount will vary depending on your five-year average salary and years of service.
Example:
Termination of employment occurred in 2023. The average Year’s Maximum Pensionable Earnings (YMPE) is $61,840.
Original five-year average salary = $78,000.00
Revised five-year average salary = $79,300.00
Years of service = 10
Lifetime pension = 2% x average salary x years of service less bridge benefit
Bridge benefit = 0.655% x [lesser of average YMPE or average salary] x years of service
The result of the increase for this retiree’s pension is $21.67 per month.
We expect to recalculate your pension starting in fall 2024 and you will receive information regarding your updated monthly pension amount, as well as any retroactive pension payment. Due to the timing of when data is expected from each employer and the high volume of recalculations, we anticipate this process will extend into 2025.
We expect to recalculate your pension starting in fall 2024 and you will receive information regarding your updated monthly pension amount, as well as any retroactive pension payment. Due to the timing of when data is expected from each employer and the high volume of recalculations, we anticipate this process will extend into 2025.
A retroactive pension payment is a one-time, lump sum payment that represents the difference between the pension payments you previously received, and your recalculated pension amounts for the period between your pension start date and the month prior to receiving the recalculated pension amount, plus interest. This retroactive pension payment will be paid at the same time as your first recalculated pension payment.
A retroactive pension payment is a one-time, lump sum payment that represents the difference between the pension payments you previously received, and your recalculated pension amounts for the period between your pension start date and the month prior to receiving the recalculated pension amount, plus interest. This retroactive pension payment will be paid at the same time as your first recalculated pension payment.
Like your regular pension payments, the amount of tax deducted is determined by the federal and provincial TD1 Personal Tax Credits Return forms that we have on file for you. You can change your claim amounts at any time by completing the form and submitting it to OPTrust through your Online Services account. Please note, if you did not complete these forms at retirement, the basic amounts were claimed.
Like your regular pension payments, the amount of tax deducted is determined by the federal and provincial TD1 Personal Tax Credits Return forms that we have on file for you. You can change your claim amounts at any time by completing the form and submitting it to OPTrust through your Online Services account. Please note, if you did not complete these forms at retirement, the basic amounts were claimed.
As with your regular pension payments, your retroactive pension payment, including the tax deducted, will be reported as income on your T4A in the year it is paid to you.
Please direct any questions or concerns to your accountant, financial advisor or the Canada Revenue Agency.
For members who would like a completed Statement of Qualifying Retroactive Lump-Sum Payment (T1198) form, which will provide a breakdown of the retroactive pension and interest amounts being paid to you for prior tax years, please submit your request through your Online Services account. The T1198 form may be included with your next tax return to request that the Canada Revenue Agency assess any tax you owe on the lump sum payment as if you had received the pension payments in each respective prior year.
As with your regular pension payments, your retroactive pension payment, including the tax deducted, will be reported as income on your T4A in the year it is paid to you.
Please direct any questions or concerns to your accountant, financial advisor or the Canada Revenue Agency.
For members who would like a completed Statement of Qualifying Retroactive Lump-Sum Payment (T1198) form, which will provide a breakdown of the retroactive pension and interest amounts being paid to you for prior tax years, please submit your request through your Online Services account. The T1198 form may be included with your next tax return to request that the Canada Revenue Agency assess any tax you owe on the lump sum payment as if you had received the pension payments in each respective prior year.
If you are a retired member receiving a pension from the OPSEU Pension Plan and you have become re-employed with an employer who contributes to the Plan you are subject to a re-employment earnings maximum.
Any retroactive salary payments related to pre-retirement employment will not be reported by your employer as re-employment earnings. Only retroactive earnings in respect of post-retirement employment will be reported by your employer as re-employment earnings, in the quarter that it is paid, and will be subject to your re-employment earnings maximum.
If you are a retired member receiving a pension from the OPSEU Pension Plan and you have become re-employed with an employer who contributes to the Plan you are subject to a re-employment earnings maximum.
Any retroactive salary payments related to pre-retirement employment will not be reported by your employer as re-employment earnings. Only retroactive earnings in respect of post-retirement employment will be reported by your employer as re-employment earnings, in the quarter that it is paid, and will be subject to your re-employment earnings maximum.
The maximum quarterly re-employment earnings, which is set by OPTrust when a member first retires, is determined by subtracting the retired member’s gross quarterly pension amount from three times their final monthly salary payable. Once your retroactive earnings have been updated by your employer, any adjustment to your final monthly salary payable will affect your maximum and be reported to you on a Pensioner Information Change Statement.
The maximum quarterly re-employment earnings, which is set by OPTrust when a member first retires, is determined by subtracting the retired member’s gross quarterly pension amount from three times their final monthly salary payable. Once your retroactive earnings have been updated by your employer, any adjustment to your final monthly salary payable will affect your maximum and be reported to you on a Pensioner Information Change Statement.