News Article

OMERS SC Still Considering Plan Changes

May, 31, 2013

At its meeting of May 28th, SC Members considered the various SPCs which have been proposed by individual SC Members.  Decisions on the SPCs have been deferred to the June 25th SC meeting.  At that time, SC Members may amend, withdraw, approve, reject or move any SPC to mediation/arbitration.  Approval of an SPC requires a two-thirds majority; an SPC requires a simple majority to move to mediation/arbitration.  Stakeholder views are taken into account by the SC during its deliberations, as are technical analyses and overall considerations of the long-term health and viability of the jointly sponsored OMERS pension plans.

Every year through an annual cycle, the OMERS Sponsors Corporation considers proposals to make changes to the OMERS pension plan. These Specified Plan Change (SPC) proposals are submitted by individual SC Board Members for consideration and decision by the entire SC board.

There are currently five proposals under consideration; for more information and details, please see below.

  • For any proposal to pass it must receive a two-thirds majority vote of the SC board, which is made up equally of employer and employee representatives;
  • Two of the proposals that have been submitted this year would permit employers to provide NRA 60 benefits to Paramedics or Police Civilians at the employer’s discretion;
  • The other three proposals that have been submitted would, if passed by a two-thirds majority of the SC, impact pension benefits earned by OMERS members in the future;
  • All benefits/pension earned prior to a proposal taking effect are protected by legislation;
  • Each proposed change is posted on the SC website and includes a summary as well as the affected members/groups, the effective dates and the rationale for the proposal;
  • The SC shares a common goal of protecting the health and long-term viability of the jointly-sponsored OMERS Pension Plans, giving due consideration to the interests of stakeholders and other relevant circumstances. Before making any decisions, the SC seeks clarification and technical information to review and consider. All proposals may be amended or withdrawn during the plan change cycle. Final decisions will be made at SC meetings in May and June;
  • All proposals and any decisions or amendments to current proposals are posted on this website as they become available;
  • You may wish to monitor this website for further information in the weeks ahead. You may also wish to review the recording of the 2013 OMERS Spring Information Meeting, as the SPCs were discussed briefly at that gathering. For context, you may also find it of interest to review prior years SPC proposals and outcomes.

Two of the current proposals would allow police civilians or paramedics (in separate proposals) to have access to the benefits under the Normal Retirement Age 60 component of the OMERS Pension Plans. The proposals, if passed, would not automatically change benefits, but would allow the employers of police civilians or paramedics to provide the Normal Retirement Age 60 benefits to these groups, at their discretion.

The other proposals, in their current form, are forward-looking in that they affect benefits that would be earned in the future. There is no effect on benefits that will have been earned before the relevant effective date.

Please refer to the chart on the Plan Changes page for links to examples pertaining to the following proposals.

Reduce Pension Benefit Indexing to 50% - Members retiring after the effective date of the proposal will continue to be entitled to indexing at 100% of the increase in the Consumers Price Index (CPI), for service up to the effective date (December 31, 2015 as amended). Pension benefits earned after the effective date will only be subject to indexing at 50% of the increase in CPI. In the future, the SC would decide whether pension benefits earned after the effective date would receive additional indexing (i.e. up to 100% of the increase in CPI). The proposal, in its amended form, provides for additional indexing up to 100% of the increase in CPI for the ten years following December 31, 2015, for any pensions in payment during that period. The amended proposal also contemplates a commitment by the SC to fully restore the indexing provisions of the plan when financial conditions allow.

Delay Early Retirement Eligibility – Members can still retire 10 years before their normal retirement age (i.e. age 50 or 55). However, pension benefits earned after December 31, 2015 may be reduced by a larger amount for those who elect to retire more than 5 years prior to their normal retirement age.

Reduce Annual Benefit Accrual Rate – This proposal would reduce the formula for determining the pension benefit earned after December 31, 2014 (but only on earnings over the CPP maximum earnings level – the YMPE). There is no effect on benefits that will have been earned before the effective date.

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