Employers may have many reasons for wanting to exit the world of DB plans, but shifting from DB to DC will not necessarily reduce the legal risks associated with being a plan sponsor or administrator. As DC plans expand in Canada in both number and scope, the potential for legal action around such plans also […]
In the recent Burke v. Hudson’s Bay Co. decision, the Supreme Court of Canada (SCC) held that plan members who were transferred to a successor pension plan as part of a sale of business were not entitled to a pro-rata share of the surplus that existed at the time of the transfer. The Hudson’s Bay […]
It has been more than 20 years since the last significant rewrite of pension legislation in Canada. Now, following a transparent process involving expert commissions, discussion papers and industry consultations, we are finally seeing the first waves of reform—in Ontario and the federal jurisdiction—breaking over the pension industry. Hard on the heels of Ontario’s Bill […]
A pension plan administrator has a legal obligation to invest plan assets prudently and in compliance with the quantitative limits on pension investments. Until recently, however, the content of the legal duty to make prudent pension investments had not received significant judicial consideration. Following a regulatory investigation, the board of trustees and investment committee of […]
It is clear at law that when an employer assumes the role of pension plan administrator, it becomes a fiduciary. However, the employer does not become a fiduciary for all plan purposes—just for those functions that relate to the administrator’s duties. Competing priorities Different legal consequences result depending on whether the employer’s function is considered […]
The challenge of managing pension plans during an economic downturn requires employers and administrators to revisit their legal responsibilities. The global financial and economic pressures that so severely affected pension plans in 2008 have shown no signs of improving in 2009. As a result, the ongoing deterioration of the capital and financial markets will demand […]
With the three expert panel reports now out on the pension reform table, it’s time for a little compare and contrast. For years, the federal and provincial governments (except Quebec) appeared disinterested in undertaking any significant pension reform. In Ontario, it has been more than 20 years since the last major review of its Pension […]
U.S. plan sponsors face a wave of litigation and proposed new regulations concerning fees charged to members in DC pension plans. Could Canadian plan sponsors encounter a similar fate? Administration/investment fees borne by plan members can have a significant impact on defined contribution (DC) plans—in particular, on the ability to generate enough income to retire. […]
Major legal issues in 2007 included the use of surplus in hybrid plans, the protection of pensions in employer insolvencies and pension reform in Quebec. What does 2008 hold in store? In honour of the new year, here are some predictions of legal issues likely to make headlines in the pension industry in 2008. Pension […]
The Ontario Court of Appeal decision in the Kerry case contains important legal guidance for employers and plan administrators regarding the use of surplus assets. Talk about impeccable timing. Coincident with the release of recent studies showing that many defined benefit(DB) plans in Canada are now “back in the black” after years of solvency deficits, […]