Larry Ketchabaw, manager of pension and benefits with Unisource, Inc.
Describe your company’s DC pension plan.
To some extent it’s a mandatory plan, and I say that because the company offers a basic 1% contribution to everybody once they become eligible to join the plan. You have to wait for 12 months from your date of employment till you are eligible. So probably, at any given time, 95% or more of our employees are actually in the plan. The way the plan works is that employees can contribute from 1% to 7%. The people that have chosen not to participate optionally, they’re still in the plan getting that basic 1% company contribution, but they’re not contributing anything on their own. Therefore, they’re missing out on the 50 cents on the dollar, or the 50% contribution that the company is matching. So employees can put 1% to 7% in, and then for every dollar the employee puts in, the company puts in 50 cents.
What is the average age of the plan members?
It’s about 45.
What’s keeping you up at night?
It’s things like the lack of harmonization among our provincial regulators and the fact that we waste so much money trying to keep everybody happy from sea to shining sea. We’re a national employer, so we’re literally right from Victoria to St. John’s. So every regulator [in between] there we have to keep happy. We did a plan change a couple of years ago—unfortunately at that time our company wasn’t doing as well—and we had to back off from a richer DC plan that we had had, where we had a 2% basic contribution and we matched 75%, or 75 cents on the dollar. We had to back it off to 50 cents just because the company was struggling a bit. It was between 2008 and 2013. We made a plan change [but] we couldn’t change it in Quebec because Quebec wouldn’t allow it. And you like to have your employees all have the same benefits. So now we have employees grandfathered in Quebec.
What pension changes would make your life easier?
What would be ideal would be that we have one federal regulation that applies to everybody. We’re not going to see that. There’s just too many political influences across the country. There’s a little bit of harmonization coming with B.C. and Alberta. They’ve actually worked on changes together more recently. But we’re just not seeing that as a possibility [on the federal level]. And it’s frustrating because it creates a ton of work. It really creates an awful lot of extra expense. Our actuaries have to take into consideration every regulator and its different requirements.
What’s one important thing you’ve learned over the course of your career?
I’ll mention something that really enlightened me probably 12 or 14 years ago. We hadn’t been doing any retirement planning [at Unisource] and, honestly, I hadn’t done enough of my own. I’m 60 years old right now, so I would have been in my later 40s or something like that. We started up a retirement planning program at Unisource and what I learned from getting exposed to understanding investing and understanding retirement planning better made a huge change in my life and what I did from that point on. It’s [also] changed the way [employees] understand how to invest their funds, it’s changed the way [they] understood what was important about life and about retirement. And it helped them prepare for retirement and position themselves better. The light bulb went off at that point in time in my career—about how important it was to do those things.
What is one thing that not many people know about you?
I love to cook. I almost feel that the most enjoyment I get is going home at night and cooking. It works out great because my wife hates to cook. I shouldn’t say hate–that’s a strong word. She is happy that I enjoy cooking because she doesn’t enjoy it as much as I do. Yesterday I cooked—and it wasn’t anything super fancy—but it was a really yummy pasta. Just fresh ingredients like mushrooms and red peppers and fresh basil and ground beef. The night before it was hamburgers and salad. I don’t tend to repeat myself very much. I like cooking from a cookbook or Googling something.
Yaldaz Sadakova is associate editor of Benefits Canada.
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