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Pension definitions

The estimated amount of money needed today to be invested to pay the future benefits you have under the Plan. The actuarial present value is based on assumptions such as interest rates, inflation, mortality, and salary escalation.
The YMPE in each year in the averaging period used to determine your best average earnings for calculation of your pension benefit at termination or retirement. Here is how we determined the 2020 average YMPE for a member who is retiring on January 1, 2021:
YMPEEarnings
2020 YMPE $58,700
2019 YMPE $57,400
2018 YMPE $55,900
2017 YMPE $55,300
+2016 YMPE $54,900
Subtotal $282,200
Divide by five $56,440
You can name any person, organization, or your estate as your beneficiary to receive survivor benefits in the event that you do not have an eligible spouse, or spousal benefits have been waived, or you do not have eligible children at the time of your passing. To make an update to your beneficiary information, log in to My Pension Resource and complete the Spousal Declaration and Beneficiary Designation form.

The annual average of your pensionable earnings for the highest 60 consecutive months of service during the last 120 months of pensionable service before your retirement or termination from the Plan. If you worked less than 60 months, your best average earnings will be based on your average earnings as a member of the Plan.

A temporary benefit provided to employees who retire prior to the age when unreduced CPP benefits begin. It is paid when you retire from your participating employer before age 65 (even if you collect an early CPP pension). The bridge benefit is payable until the earlier of age 65 or your passing.

Learn more about the bridge benefit.

 

The CPP is a contributory, earnings-related social insurance program that is paid by the federal government. It provides a measure of income to contributors and their families upon retirement, disability, and death. For further details, contact Service Canada.

The CRA is the federal regulatory agency that administers the Income Tax Act.

The lump-sum value of your earned pension. The commuted value changes based on factors such as age, life expectancy, inflation and interest rates.

An inflation measure computed by Statistics Canada that calculates the change in prices of a fixed set of commodities purchased by Canadians each month. If the combined cost of these goods goes up, inflation increases. The CPI is used to calculate annual cost-of-living increases for pension benefits, also referred to as “indexing”.

This is the pension benefit earned up to the date of termination of employment, which is calculated at the time of termination of employment but payable at a later date. Learn more about this onleaving your employer.

A pension plan that defines the ultimate pension benefit to be provided in accordance with a formula, usually based on years of service and earnings. WISE Trust is a defined benefit pension plan.

Learn more on the advantages of a defined benefit pension plan.

Retirement before you reach age 65, in which you may receive a reduced pension or an unreduced pension.

Learn more about this on the retirement page.

 

An eligible child includes your natural, adopted, or step child in respect of whom you are acting in the role of a parent and who is:

  • under age 18; or
  • 18 or older but less than 25 and attending full-time, continuous education; or
  • 18 or older and suffers from a physical or mental disability that has prevented them from earning a living since reaching 18 or since your death, whichever occurred most recently.

Eligible spouse means, on the relevant date, either of two persons who are

  • married to each other; or
  • not married to each other but are living together in a conjugal relationship, either:
    • continuously for a period of not less than three years; or
    • in a relationship of some permanence, if they are the parents of a child, as set out in Section 4 of the Children’s Law Reform Act pursuant to subsection 1 (1) of the Pensions Benefit Act.

On termination of employment, the Plan compares 50 per cent of the commuted value of the member’s deferred pension to the total of their contributions plus interest. If the member’s contributions plus interest equal more than 50 per cent of the commuted value of the pension, then that member is entitled to a refund of the difference, called excess contributions.

An independent regulatory agency, an objective of which is to improve consumer and pension plan beneficiary protections in Ontario.

Learn more about them on FSRA’s website.

The Policy, which is approved by the WSIB and the OCEU as Sponsors of the Plan, provides a framework for the financial management of the pension benefits earned under the Plan and the corresponding assets of the trust fund that secure those pension benefits.

A federally legislated act with underlying regulations that outline, among other things, the maximum limits for registered pension plans. The Income Tax Act allows employees and employers to deduct pension contributions from their respective income for tax purposes and sets standards for the benefits a pension plan can provide. It is regulated by CRA.

A method in which pension benefits are adjusted to take into account changes in the cost of living.

A pension plan in which decision making and funding of the benefits is shared jointly by both employees and the participating employer. It’s a pension plan where there is a partnership in the governance of the plan.

The lifetime pension is the amount paid to you for the rest of your life once you retire, inclusive of any further indexation. This amount does not include the bridge benefit, which is paid on top of the lifetime pension up to age 65. Once you reach age 65, the bridge benefit ends and you continue to receive the lifetime pension.

A legislative requirement stipulating that vested entitlements under a pension plan must be used to provide pension payments at retirement and are not available as immediate cash.

A tax-sheltered retirement savings arrangement in which the funds are subject to locking in under pension legislation. Funds in a locked-in retirement savings arrangement cannot be withdrawn prior to the age of 55 and the payment of retirement income from the arrangement must begin no later than the end of the year in which you reach age 71. Examples include annuities, locked-in retirement accounts, life income funds, and other registered pension plans that will accept the commuted value of a deferred pension.

Learn more about this on leaving your employer.

 

A type of RRSP available to maintain funds that are locked-in as required by pension legislation. These funds must be used to purchase a life annuity or be transferred to a life income fund no later than the end of the year in which you reach age 71.

An employee of a participating employer who is contributing to the Plan or has contributions made on their behalf. Member also includes a former employee of a participating employer who made contributions to the Plan and has either terminated employment or terminated membership in the Plan and (i) retains the right to a deferred pension payable from the Plan or (ii) is receiving a pension payable from the Plan.

This includes the period commencing on the date an employee becomes a member of the Plan until the date the employee terminates the employment that relates to the Plan or terminates membership in the Plan. Any period during which a member was absent from work on a leave of absence, as well as any period of pensionable service transferred into the plan or purchased subject to the Plan’s terms will be included in the calculation of the member’s period of membership. Membership will not be broken for the sole reason that an employee ceased employment with one participating employer and immediately began employment with another participating employer.

An online self-service site for members to log in to view their personal pension details, estimate their pension, request a quote to purchase pensionable service, download forms, tip sheets, the guidebook, and more.

Login to My Pension Resource.

Normal retirement age under the Plan is age 65. The normal retirement age does not compel retirement at age 65, but rather sets the age when unreduced pensions are paid regardless of the years of pensionable service you have under the Plan.

The Workplace Safety and Insurance Board (WSIB), Infrastructure Health and Safety Association (IHSA), Public Services Health and Safety Association (PSHSA), Workplace Safety and Prevention Services (WSPS), Workplace Safety North (WSN), and the Trustees of the Workplace Safety and Insurance Board Pension Plan Fund (WISE Trust).

The deemed value of additional pension benefits purchased for service in previous years. The CRA generally must approve the PSPA before the purchase of additional benefits can be completed and before the purchase can be included in any benefit calculation.

The CRA’s deemed value of the lifetime benefit a member earns during a calendar year under a pension plan, and it affects the member’s RRSP contribution room for the following year.

The pension adjustment is the annual pension amount earned by the member during the year, multiplied by nine, and then the prescribed amount of $600 is subtracted.

The pension adjustment is reported on your T4 tax slip, and your available RRSP contribution room for the following year is reduced by the pension adjustment amount.

Provincial legislation enforced by FSRA, which regulates pension plans in Ontario and determines minimum standards for eligibility, funding, and benefits for Ontario-registered pension plans.

Learn more about the legislation: Pension Benefits Act (PBA).

The basic amount of remuneration actually received for the position held by you, as a member of the Plan, and includes:
  • the amount of benefits that you are in receipt of under the Workplace Safety & Insurance Act (WSIA) for loss of earnings and any amount supplemented by the WSIB up to the maximum of your regular earnings
  • non-bargaining unit lump-sum merit awards
  • earnings if you are receiving long-term disability benefits

Pensionable earnings do not include:
  • overtime pay
  • irregular-hour premiums
  • performance bonuses
  • job differential pay
  • second-language bonuses
  • pay in lieu of vacation or Management Compensation Option
  • any payment in lieu of a benefit provided by your participating employer

Represents the total years, months and days of service during which you or your employer have contributed to the Plan on your behalf. Subject to the Plan’s terms, it includes any pensionable service you have purchased, transferred in, or service during which you were receiving short-term or long-term disability benefits or while you were in receipt of benefits from a claim filed under the WSIA.

If you are a part-time employee, your pensionable service is calculated as a proportion of the pensionable service that an equivalent full-time employee in the same employment category would accrue. Learn more under pensionable service.

 

A pension that starts before age 65 and is subject to a reduction for starting your pension early. The reduction for starting your pension early means the pension is reduced by three per cent for each year (and any fraction thereof) your retirement falls before the date you would have qualified for your earliest unreduced pension.

Learn more about this on collecting your pension.

This is a savings arrangement available from most financial institutions that accumulates contributions and investment earnings on a tax-sheltered basis.

The annual statement of earnings and deductions provided to employees and to the CRA by the employer.

The annual statement of pension earnings and deductions provided to retirees and to the CRA by WISE Trust.

An unreduced pension is a pension that is not subject to an age reduction. You may receive an unreduced or lesser reduced pension at age 65 or, earlier provided you have qualified under the early retirement provisions of the factor 85 or 60/20 rule.

Learn more about this on collecting your pension.

A term used in the CPP that refers to the earnings on which CPP and Quebec Pension Plan contributions and benefits are calculated. The YMPE is re-calculated each year according to a formula based on average wage levels. The YMPE is published annually by the CRA.

Transferring your pension

You may be able to transfer the value of your pension earned in a former employer’s pension plan into the WSIB Employees’ Pension Plan (the Plan). Deadlines and other eligibility requirements apply.

Why should I transfer my pension?

Combining your pension into the Plan may increase the overall value of your pension at retirement.

Transfer scenarios

There are the two ways you can do this:

How a transfer works and what you need to know

You must make your request to transfer your pension value within six months of joining the Plan and within 18 months of leaving your former employer.

Transfers can take up to one year to complete because of the various communications that take place between pension plans and other administrators such as the Canada Revenue Agency (CRA).

To start

Contact WISE Trust

Check the eligibility requirements and if you think you meet them, call the WISE Trust Pension Contact Centre and be prepared to provide us with:
  • the name of your previous pension plan,
  • the date you terminated from your previous pension plan,
  • confirmation that the funds are still in your former pension plan.
To start

1 month

If you are eligible:

  • We will send you paperwork to begin the transfer process.
  • We will ask you to provide proof of age. Acceptable formats include:
    • birth certificate,
    • valid driver’s license, or
    • Canadian Citizenship card.
1 month

Important

Tip

To ensure a smooth process, make sure you sign and complete all forms/paperwork fully. 

Important

3 - 4 months

Next steps

Once we have received your correctly completed forms and proof of age, next steps include:
  • We will communicate with your previous pension plan
  • A calculation will be completed to determine what your pension benefits will be
  • Transfer election forms will be sent to you.
3 - 4 months

Important

Tip

Ensure you check the deadlines for when paperwork is due. If you miss the deadlines, your transfer will be cancelled.
Important
star

Decision required

Here is where you will have the choice to proceed with the transfer or not.

Decision required

3 - 4 months

Proceed with transfer

If you elect to proceed with you transfer, we will complete:

  • a past service pension adjustment (PSPA) calculation
  • a CRA filing
  • request the funds from your previous pension plan
3 - 4 months

Important

Tip

If you have not received an update on the status of your transfer, we recommend following up with your former pension plan or the WISE Trust Pension Contact Centre within 3 months of initiating your request.
Important

2 months

Approval and Transfer

  • Once CRA approval is complete and the funds have been received, your pensionable service will be credited and be included on your annual pension statement under the year the transfer was approved and completed.
  • You will receive a confirmation letter in the mail confirming that your transfer has been completed.
2 months