Defined Benefit (DB) Component of The University of Winnipeg Trusteed Pension Plan
The information provided here is intended as a summary of the more important features of The University of Winnipeg Trusteed Pension Plan. The benefits and terms and conditions under which they are provided, are governed by the legal Plan document, and in any dispute the legal Plan document will take precedence over the information provided here. A copy of the Plan text is available on the Pension Home Page.
For general information in connection with the University of Winnipeg Trusteed Pension Plan please go the Pension Plan Home Page.
Background
The object of the University of Winnipeg Trusteed Pension Plan is to provide monthly income to University employees after they retire. The Plan also provides benefits on death and termination of employment. The complete terms and conditions of the Plan are contained in a long and somewhat complex legal document a copy of which is provided here as an attachment. The purpose of this summary is to outline the more important features of the Plan in less technical language and in any dispute, the Plan document will take precedence over the information provided here. For additional information relating to the Plan, please contact Human Resources.
Beneficiary Designation
If you have a Spouse, your Spouse has certain rights to the benefits earned under the Plan at your death, retirement or marriage/relationship breakdown. For the purposes of the Plan, Spouse includes legally married or common-law partner.
Your Spouse, legal or common-law, is entitled to receive any death benefit from the Plan, however, your spouse may waive his/her right to the pre-retirement death benefit by completing the appropriate waiver form and filing it with Human Resources. The waiver may subsequently be jointly revoked. Please note that before the waiver form may be filed, your spouse needs to receive a termination statement setting out the amount payable from the University of Winnipeg Trusteed Pension Plan. Please contact Mark Betcher in Human Resources if you have any questions or wish to obtain a waiver form.
If you do not have a Spouse, you may designate a beneficiary of your choosing.
Ensure your beneficiary is aware of this Plan and knows where your estate related documents are kept.
Please note:
The Manitoba Pension Benefits Act does not allow pension benefits to be paid to a separated spouse of a plan member unless the following condition has been met:
- Married Couples – the marriage has been dissolved through a divorce;
- Common-law Couples – the relationship has been terminated as follows:
a) In the case of common-law partners who have registered their common-law relationship under section 13.1 of The Vital Statistics Act, the common-law relationship has been terminated through the registration of the dissolution of the common-law relationship under section 13.2 of the Vital Statistics Act, and
b) In the case of common-law partners who did not register their common-law relationship under section 13.1 of The Vital Statistics Act, the common-law partners have terminated their relationship by living separate and apart for at least three years.
Canada Pension Plan (CPP) and Old Age Security (OAS)
In addition to the University of Winnipeg Trusteed Pension Plan pension you will also receive pension from the Canada Pension Plan (CPP) as well as Old Age Security (OAS). For an estimate of your entitlement from the government plans, please contact Service Canada at 1.800.277.9914 or go to:
CPP Payment Amounts
http://www.servicecanada.gc.ca/eng/services/pensions/cpp/payments/index.shtml
OAS Payment Amounts
http://www.servicecanada.gc.ca/eng/services/pensions/oas/payments/index.shtml
OAS clawback information (minimum and maximum income recovery threshold)
http://www.servicecanada.gc.ca/eng/services/pensions/oas/pension/recovery-tax.shtml
Contributions from December 23, 2012
Full-time member required contributions (made by Plan member):
Your required contributions are the sum of:
i) 8% of your Basic Salary up to the Year’s Basic Exemption (YBE); and
ii) 6.2% of your Basic Salary between the YBE & the Year's Maximum Pensionable Earnings (YMPE); and
iii) 8% of your Basic Salary, if any, between the YMPE & the Year’s Maximum Contributory Earnings.
Full-time member required contributions (made by the University):
The University's required contributions are the sum of:
i) 9% of the member’s Basic Salary up to the Year’s Basic Exemption (YBE); and
ii) 7.2% of the member’s Basic Salary between the YBE & the Year's Maximum Pensionable Earnings (YMPE); and
iii) 9% of the member’s Basic Salary, if any, between the YMPE & the Year’s Maximum Contributory Earnings.
Less than full-time member required contributions:
The Plan member and the University make required contributions as above but based on the actual salary of the member rather than the Basic Salary.
Additional Voluntary Contributions
Effective from June 1, 1990, no further additional voluntary contributions may be made into the Plan. Any Plan member who has made additional voluntary contributions prior to June 1, 1990 may receive the full value of such contributions in a lump sum (subject to Manitoba Pension Commission restrictions).
Leave of Absence With Pay
If you are on a leave of absence with pay, you and the University will continue to make required contributions based on your full Basic Salary (subject to Canada Revenue Agency restrictions).
Leave of Absence Without Pay
If you are on a leave of absence without pay, you may if you wish, continue to make contributions to the Plan for up to three years (subject to Canada Revenue Agency restrictions), however, in that case you would have to make your own as well as the University required contributions.
Long Term Disability
If you are receiving benefits from the University of Winnipeg Long Term Disability Plan, the University will make your and the University required contributions (effective from April 1, 2003) for as long as you are in receipt of long term disability benefits or until your employment terminates, whichever occurs earlier.
Past Service Additional Contributions
If, because of an administrative error by the University, you did not join the Plan on the date that you should have done in accordance with the terms of the Plan at that time, you may elect to buy-back the Credited Service to which, but for the error, you would have been entitled. The past service additional contributions would consist of the required contributions that you would have made to the Plan, plus applicable interest.
The University will match any Past Service Additional Contributions.
Reduced Appointment
If you are on a Reduced Appointment, you will continue to make contributions based on full Basic Salary, subject to Canada Revenue Agency restrictions relating to pension accumulation during periods of reduced pay.
Cost of Living Adjustments
(Referred to as Supplementary Pension in the Plan text)
After your pension has commenced it will be increased to offset the effects of inflation to the extent possible. The amount of the increase is dependent on the investment performance of the pension Fund and is limited to the increase in the Consumer Price Index (CPI) over the same period. If the pension Fund earns a return in excess of 6% per annum (calculated as a moving Geometric Average of the last four years of Market Value returns, net of administrative expenses and investment fees*), and there is an increase in the CPI during the same period, your pension will be increased by the difference between the rate of return on the fund and 6%, capped by the increase in the CPI. If the return on the Fund is less than 6% in a particular year, there will be no increase. These adjustments are made July 1 of each year and cover the preceding calendar year.
If the return on the pension Fund in one year is not high enough to cover the full increase in the Consumer Price Index, and in a subsequent calendar year the available increase is limited by the CPI increase, the Board of Trustees may provide that the increase in the subsequent year be modified to include part or all of the shortfall in the preceding year’s increase.
- List of Supplementary Pension Increases [PDF 1P/5KB]
*The Geometric Average calculation for the purpose of cost of living adjustments is effective for calculations from January 1, 2011. Prior to 2011, cost of living adjustments were calculated using a "smoothed" actuarial value of four years of net fund returns.
Death Benefits
If you should die prior to your Normal Pension Commencement Date, the death benefit would be the Commuted Value of your Deferred Pension for all years of Credited Service.
The benefit is payable in a lump sum to a beneficiary other than your Spouse. If you do have a Spouse, the benefit is paid in the form of a life annuity purchased from an Insurer or a lump sum transfer to a Locked-In Retirement Account or to a Life Income Fund.
If you should die prior to your actual retirement but after your Normal Pension Commencement Date, the benefit will be calculated as if you retired on the date of death. If you have filed an option form selecting a particular form of pension, then the death benefit will be payable in accordance with the selected option. Otherwise, the death benefit will be payable as a survivor pension (Joint and Survivor pension, reducing to 2/3 on either death) if you have a Spouse, and in the Normal form (Single Life pension, guaranteed for 5 years) if you do not have a Spouse.
Where death occurs after retirement, the death benefit is in accordance with the form of pension selected at time of retirement.
Interest
Effective from January 1, 2010, interest credited to a Plan member's required contribution account is calculated using the average of the CANSIM Series V 122515 rates published by the Bank of Canada for the months for which interest is to be credited.
Joining the Plan
The Defined Benefit component of the University of Winnipeg Trusteed Pension Plan is closed to new members effective from January 1, 2001.
Marriage/Relationship Breakdown
Your pension assets may be subject to division between you and your Spouse in the event of the breakdown of your marriage or common-law relationship. The prerequisite to a division of pension is the existence of a Court Order or written agreement between the parties to divide family assets, a certified true copy of which must be submitted to the University of Winnipeg Human Resources Office.
In accordance with The Pension Benefits Act of Manitoba, the pension credits accumulated by one or both Spouses during the years of marriage or common-law relationship would be split on an equal basis between the Spouses. The former Spouse's share of the benefit would be transferred out of the Plan and the Plan member's benefit entitlement would be reduced accordingly.
Your former Spouse may transfer the assets to the registered pension plan of his/her employer, a LIRA (Locked In Retirement Account) or a LIF (Life Income Fund) with any financial institution authorized to issue LIRAs/LIFs.
The requirement to share pension benefits applies to both required as well as Additional Voluntary Contributions, and any Plan Surplus entitlement, and cannot be waived unless the former Spouse, having first received a statement from the Plan administrator outlining his/her entitlement as well as independent legal advice, agrees to opt out by completing the appropriate waiver in a form prescribed by the Manitoba Pension Benefits Act. The completed waiver, with original signatures, must be filed with Human Resources.
A Plan member who wishes to restore, either fully or partially, the benefits lost (only pre-1990 Credited Service may be restored), may transfer monies from either the Additional Voluntary Contributions account, an RRSP, or the former Spouse's employer pension plan. This reinstatement must be made within 12 months of the date of the transfer-out except where the Plan member does not have sufficient tax-sheltered funds to do so, in which case application may be made to the Board of Trustees to waive this 12 month restriction.
Maximum Pension
The maximum annual pension at retirement, termination of employment or termination of the Plan cannot exceed the lesser of:
(i) $1,722.22 for each year of pensionable service, and
(ii) 2% x average best 3 consecutive years of earnings x years of Credited Service
Since the Plan formula is based on five year average earnings and integration with CPP benefits, the second limit would not affect any member of this Plan.
Effective from January 1, 1997, contributions are not required on that portion of Basic Salary which would provide a benefit in excess of the Plan limit, and pensionable earnings are limited to the Year's Maximum Contributory Earnings.
If you elect to buy-back Past Credited Service that is for a period prior to January 1, 1990, and the election to buy-back the Credited Service is made after June 7, 1990, the maximum annual limit that will apply to the Past Credited Service will be $1,150 as per Canada Revenue Agency regulations.
Pension Adjustment/Pension Adjustment Reversal
The amount that you can contribute to a Registered Retirement Savings Plan (RRSP) on a tax-deductible basis will be directly affected by the benefit you earn under this Plan or any other registered pension plan.
The Pension Adjustment (PA) is based on the Plan benefit (formula pension or maximum pension, whichever is less) you earn in each year and is reported to the Canada Revenue Agency on your T4 slip. The PA is for tax reporting purposes only and the amount that you can contribute to an RRSP next year is reduced by your PA calculated for this year.
The Canada Revenue Agency will advise you of your RRSP contribution room for each taxation year on your Notice of Assessment.
When you leave the Plan either through termination of employment or retirement, you may be entitled to a Pension Adjustment Reversal (PAR). A PAR restores some RRSP contribution room which was lost due to the reporting of the Pension Adjustments. A PAR is calculated for any Plan member who elects to receive a lump-sum payment in complete settlement of entitlement from the Plan.
Pension Commencement
Normal Pension Commencement
If you are an Academic Plan member, your Normal Pension Commencement Date is September 1, next following or coincident with your 65th birthday, if you attained your NPCD prior to May 30, 2010. If you attain your NPCD after May 30, 2010, your NPCD is the first of the month next following or coincident with your 65th birthday.
If you are a Non-Academic Plan member, your Normal Pension Commencement Date is first of the month next following or coincident with your 65th birthday.
Early Pension Commencement
You can retire and start receiving your pension at any time within the ten year period immediately preceding your Normal Pension Commencement Date.
If you retire after age 61 and at that time the sum of your age and Service is 85 or more, your pension would not be reduced for early retirement.
If, at the time of retirement, you are less than 61 years of age and/or your age plus Service equal less than 85, your pension will be reduced by 0.25% for each month by which your early retirement date precedes the date on which you would have qualified for unreduced pension, if you had continued in employment.
Late Pension Commencement
If you continue in employment with the University after your Normal Pension Commencement Date, you will continue to make pension contributions and earn additional pension benefits. However, Canada Revenue Agency regulations stipulate that any pension payments must commence no later than December 31 of the year in which you attain age 71 even if you continue in employment beyond this date.
Since payments from the Defined Benefit component of the University of Winnipeg Trusteed Pension Plan are made in advance on the first of the month, effectively this means that pension participation must cease by November 30, with the first pension payment being due December 1st.
The Pension Fund
Contributions from Plan members and the University are paid to a Trust Fund (The University of Winnipeg Trusteed Pension Plan Trust) and invested in accordance with the Pension Benefits Act of Manitoba and Canada Revenue Agency regulations. The Plan is subject to an actuarial review at least every three years to determine if the assets are sufficient to provide the promised benefits. The investment of the funds is directed by one or more Investment Managers selected by the Board of Trustees.
The current Investment Managers are:
- Sprucegrove Investment Management Ltd.
- Foyston, Gordon, Payne Ltd.
- Civil Service Superannuation Board
The pension funds are held by the Plan custodian, CIBC Mellon.
Plan Formula
The Formula used in calculating your pension is as follows:
2% x Final Average Earnings x Years of Credited Service
Less:
0.6% x CPP Average Earnings x Years of Credited Service (after Dec. 31/87)
Equals:
Annual Pension (subject to the Plan maximum of $1,722.22 for each year of pensionable service)
Portability
If you terminate employment prior to retirement age and your annual Deferred Pension is greater than 4% of the Year's Maximum Pensionable Earnings, you may transfer the Commuted Value of your Deferred Pension to the pension plan of your new employer if that plan so permits or to a Locked-In Retirement Account (LIRA).
If the amount to be transferred out of the Plan is greater than the maximum amount permitted under Canada Revenue Agency regulations, the excess will be paid to you as a taxable lump sum refund.
If you terminate employment after you reach retirement age, but prior to January 1 following the year in which you attain age 71, you may transfer the Commuted Value of your immediate pension to the pension plan of your new employer if that plan so permits or to a Locked-In Retirement Account (LIRA) or a Life Income Fund (LIF).
If the amount to be transferred out of the Plan is greater than the maximum amount permitted under the Canada Revenue Agency regulations, the excess will be paid to you in a taxable lump sum, or if you are less than age 65 by a temporary level monthly pension to age 65. If the amount of the temporary pension is less than 4% of the Year's Maximum Pensionable Earnings, the excess will be paid to you as a taxable lump sum refund.
Effective May 25, 2005, the Manitoba Pension Benefits Act was amended to allow a one-time transfer of up to 50% of the balance in one or more LIFs or to a prescribed RRIF (Registered Retirement Income Fund). ‘One-time’ means once in your lifetime, not once per fund.
Retirement Benefits
Normal form of pension
The Normal form of pension payment under the Plan is called Single Life, 60 months certain. This means that pension payments would be paid to you for as long as you are alive, and if you should die before 60 monthly payments have been made, the balance of the payments remaining in the 60-month guarantee would be paid to your beneficiary or estate. The Normal form of pension represents the base amount from which all other forms of pension payment are calculated.
Mandatory form of pension
The MB Pension Benefits Act states that if you have a Spouse at the time of retirement, you must choose a form of pension that will provide lifetime payments to your spouse in the event of your death; the continued payment to your spouse may not be less than 60%. The mandatory form of survivor pension under the University of Winnipeg Trusteed Pension Plan provides a slightly higher survivor benefit of 66.67% (the initial payment to you would be slightly lower than under the PBA mandatory pension) and you may, if you wish, at the time of retirement request to receive an estimate of the amount payable under the PBA form of mandatory pension.
Other forms of pension
You are not required to choose the Normal form of pension or the Mandatory form of pension. As long as regulatory requirements are satisfied, you may choose from a variety of optional forms of pension. Monthly payments under any of the pension payment options may be guaranteed from 5 to 15 years.
- List of available annuity payment options [PDF 1P/4KB]
Shortened Life Expectancy
Effective from July 1, 2011 a Plan member with a terminal illness or disability resulting in a shortened life expectancy as stipulated in the MB Pension Benefits Act (Act), and subject to satisfying all the relevant provisions of the Act, shall have the right to elect to cease accruing pension benefits under the Plan and receive his/her accrued pension entitlement by way of a lump sum payment.
A Plan member who has elected to receive his/her accrued pension entitlement from the Plan under the Shortened Life Expectancy provision, will cease to be an Active member of the Plan and will make no further contributions into the Plan.
Termination Benefits
The Plan has immediate Vesting provisions, therefore, if your employment with the University terminates before you reach retirement age, you will be entitled to a Deferred Pension. The Deferred Pension will be calculated based on your Basic Salary and years of Credited Service up to your date of termination, payable from your Normal Pension Commencement Date
You may, if you wish, commence the payment of your Deferred Pension any time within the ten year period preceding your Normal Pension Commencement Date. If you have less than 20 years of Service at date of termination of employment, your early pension will be the actuarial equivalent of the Deferred Pension that is payable to you from your Normal Pension Commencement Date.
If you have at least 20 years of Service at termination, your pension will not be reduced if it commences after you attain age 61 and your age and service total at least 85. If you wish to commence your pension prior to this date, the amount payable would be the actuarial equivalent of the Deferred Pension that is payable to you from the date it would first be paid on an unreduced basis.
If the Locked-In portion of your termination benefit results in a Deferred Pension of less than 4% of the Year's Maximum Pensionable Earnings (YMPE), or if the Commuted Value of the Deferred Pension is less than 4% of the YMPE (20% of the YMPE after May 31, 2010), the Lock-In restriction is waived. In that case you must receive the Commuted Value of your Deferred Pension either as a taxable cash refund or as a transfer into your Registered Retirement Savings Plan.
If your contributions with interest made from January 1, 1985 amount to more than 50% of the Commuted Value of the Deferred Pension with respect to that period of Service, you may either receive a cash refund of the excess or apply it to increase the Deferred Pension.