Employer

Earnings and service guidelines, examples

The agenda and materials for the teleconference are posted here on e-campus.

19-2012

In case you missed the April 24 teleconference, you can find a summary of it here on E-campus:

New remittance forms and instructions are on E-Campus

Also on E-Campus is a new section dedicated to remittance-related information. In it, we have posted new remittance forms and guidelines for using them.

Next teleconference is May 17

Mark your calendars for our next teleconference scheduled for May 17 from 10-11 a.m. Please contact us with suggestions and questions for inclusion by May 7. We will advise when the agenda for that event has been posted.

17-2012

In case you missed it, a summary of the first-in-a-series of pension administration updates has been posted to E-Campus.

Teleconferences section of E-campus

E-campus now features a new page about pension administration teleconferences. Here you will find summaries of past teleconferences and the date, agenda, and any advance materials for the next teleconference.

Next teleconference is April 24

Mark your calendars for our next teleconference scheduled for April 24 from 10-11 a.m. We will advise when the agenda for that event has been posted.

14-2012

We have prepared the following message for members regarding the recent budget announcements. At the bottom of this email, you will find the link to our web page where it has been posted, and a message you can use to forward the link to your members.

This week saw the budgets tabled in the Ontario legislature and the House of Commons. Although both contain announcements related to pensions, neither budget has an immediate effect on your benefits in the CAAT Pension Plan.

Federal Budget

Changes to Old Age Security
The federal budget announced the government’s intention to delay the age Canadians can begin to receive Old Age Security (OAS).This change will start in April 2023, with full implementation by January 2029. The change does not affect anyone who is 54 years of age or older. If you’re under 50, you will need to wait to age 67 to begin collecting OAS. If you’re between 50 and 54, you can start OAS between age 65 and 67. For details, please see http://www.fin.gc.ca/n12/data/12-033_4-eng.asp.

How does this affect your CAAT Pension Plan benefits? It doesn’t.
The CAAT Plan is independent of government pensions. This change does not affect your CAAT pension benefits, including the bridge benefit. We will be updating our popular pre-retirement planning presentation to reflect these changes and how they may impact your overall retirement goals.  We encourage you to sign up for one of these sessions when the CAAT Pension Plan representative visits your college.

Ontario Budget

50-50 Cost sharing
The Ontario government expects single-employer pension plans, which include the province’s universities, to move towards an equal cost-sharing between employers and employees for future contributions. This is to be done within 5 years. To encourage this move, the government will provide temporary solvency funding relief. The government will also support efforts to convert these pension plans to jointly-sponsored pension plans.

How does this affect you? It doesn’t.
The CAAT Pension Plan already has equal cost sharing — this means that for each dollar you contribute to the pension plan, your employer contributes a dollar. As well, the CAAT Pension Plan is already a jointly-sponsored pension plan — this means that members and employers share the responsibility and risks of the pension plan.  Since the CAAT Plan serves many employers we already have a permanent solvency funding exemption, keeping the Plan affordable.

Pooling of pension fund assets
The government intends to introduce a legislative framework this fall to facilitate the pooling of pension fund assets from single-employer pension plans. This could be done either by creating a new investment management entity, or by building on to an existing large public-sector pension fund.

How does this affect you? It doesn’t.
The CAAT Pension Plan is a sector-wide plan with membership from across the province’s 24 colleges and five non-college employers, who have already pooled the assets and administration. As a $5.6 billion fund, the CAAT Pension Plan is already a large, low-cost, efficient pension fund.

If there is a funding shortfall
The Ontario budget outlines that in instances of future funding shortfalls, pension plans will need to reduce future benefits being earned rather than increase contributions to cover actuarial deficits. This would only take effect if there was a funding shortfall. If Plan sponsors can’t reduce benefits through negotiations, then a third-party dispute resolution process would be invoked. The entire framework remains in place until the Ontario budget is balanced.

How does this affect you?
We are awaiting further details, but there is no impact at least through 2014. The CAAT Pension Plan has an actuarial surplus so our benefit design does not need to change.  And remember, the pension benefits you have earned to date are guaranteed. If any change was required it can only be applied to future service benefits.  We strongly believe that the three sponsoring organizations, OPSEU, OCASA, and Colleges Ontario, are in the best position to balance the needs of members and the college system while maintaining the long-term health of the pension plan.  We will continue our advocacy efforts to meet the fiduciary requirement to manage the Plan in the best interests of its beneficiaries – You!

For more information on the Ontario budget, see: http://www.fin.gov.on.ca/en/budget/ontariobudgets/2012/

If you have any comments or questions, please e-mail us at contact@caatpension.on.ca.

Please send the following as an email to members:

Subject: Recent budget announcements and the CAAT Pension Plan

Dear CAAT Pension Plan Member,
Please read this update posted on the CAAT Pension Plan website on March 30, 2012.
http://www.caatpension.on.ca/en/about-us/news/your-caat-pension-and-rece...

12-2012

We are pleased to announce the first in a series of regularly scheduled teleconferences about pension administration, to be held on Tuesday, April 3, from 9:30 to 11:00.

At this teleconference, we will be introducing a schedule of initiatives the Plan will be undertaking throughout the rest of 2012, and into next year. This will give you a high level overview of the projects which will require your support to implement over the next 18 months.

The teleconference will focus on initiatives in four key areas where we are working to improve our services and our value:

• Changes to pension legislation
• Pension Administration service improvements
• Direct support to employers
• Services to Plan members

We will go into detail on a few of the more significant items, and provide an update on some of the recent changes the Plan has made – including provisions related to immediate vesting. We will also review proposed changes to the process for the Data Collection Tool.

A more detailed agenda will be issued next week.

10-2012

We would like to thank those of you who have submitted your member data in advance of the DCT deadline. As in the past few years, we will be sending you a sweet surprise to show our appreciation.

We do have some treats left over, so if you who haven’t yet submitted your data, we encourage you to do so as soon as possible. Please submit your complete and accurate DCT data to us on or before Friday, March 30 to receive your treat!

Again, we thank you for your assistance in updating our records so that members will receive their annual statements on time.

9-2012

As communicated in our Fall 2011 member newsletter, effective January 1, 2012 employees who work past age 65 while collecting their Canada Pension Plan pension have the option to stop contributing to CPP or to continue to contribute (up to age 70) and build CPP’s “Post-Retirement Benefit.”

Any CAAT Pension Plan member over age 65 who elects to stop contributing to CPP must contribute to the CAAT Pension Plan at the higher rate on all earnings. During this period, they will build their CAAT Plan pension at the higher benefit rate. Please remember that we must rely on the information you provide to the Plan to know if a member should be contributing at the high rate only.

If you have CAAT Plan members over 65 who have stopped or wish to stop contributions to CPP, have them complete and submit to the Canada Revenue Agency form CPT30: Election to Stop Contributing to the Canada Pension Plan or Revocation of a Prior Election, if you have not already done so. This form is available on the CRA website.

Our “Making Choices” booklet, Working Past 65 has been revised to better address the choices available to members as a result of the CPP changes. Please distribute it to all members who have reached age 65. The booklet outlines the factors the member should consider in deciding whether or not to continue to contribute to CPP.

The E-Campus pages of our website on this topic have also been updated.

If you have questions, please contact your Pension Analyst.

08-2012

Learn about draft Guidelines for the Contributory Earnings Reporting, and other important updates

For those who were unable to join us for the DCT Workshop on Friday, February 17, we have a quick update on pertinent information for all employers.

Survey Reminder
If you did join us for the DCT Workshop, we want to hear from you. Share your feedback and comments with us through this survey.

Guidelines for Contributory Earnings Reporting
The new Guidelines for Contributory Earnings Reporting can be found here on E-campus. The draft guidelines were developed by Plan staff, in consultation with several employers who took part in the Payroll Advisory Panel. We are now asking all employers to review the guidelines and compare them to your payroll codes and procedures.

The guidelines will help you determine what earnings are pensionable, in order to administer the Plan according to the Plan text. Their goal is to promote consistent treatment of Plan members, and to update the current rules with the needs of the evolving college system.

Before finalizing the guidelines we would like your feedback. If you have any questions or comments, please send them to contact@caatpension.on.ca before March 2, 2012. In your subject, please indicate you are writing about “Pensionable Earnings Draft Guidelines.” Once completed, the guidelines will be available electronically and will be used to update current administrative practices.

DCT Enhancement for 2012 Data in 2013

At the workshop, we also discussed the DCT enhancement scheduled for 2013. Here are the main points that were covered:

• We will be adding an Errors tab to the Update screen to show all errors for each member.
• We will be collecting earnings in monthly “buckets” to facilitate the HAPE calculation.
• We will be collecting the hours worked and the full time equivalent hours worked for all members.
• We will begin collecting non-member data to track eligibility during the OTRFT waiting period.
• Contributions for earnings above the RCA threshold will all go to the RCA plan, eliminating red flags.
• To comply with the new CPP rule, if a member is over 65, we will have an indicator with a “Y” for yes and an “N” for No. This will help us keep track of whether a member is contributing to CPP or not.
• For Pregnancy/Parental payroll deductions, you will report the deemed earnings and deemed contributions together with the basic information.
• For other service purchases, you will report the deemed earnings in a separate section. This will help to validate that your reported PA is correct.

These changes will be implemented in the 2013 DCT next spring and will apply to 2012 member data. Further details will be provided during the year.

Presentation slides available

If you would like to see the presentation slides, you can find them here on E-campus.

07-2012

Log-in instructions, agenda and presentation materials

Thank you for registering for the 2012 Data Collection Tool Workshop. Find all the information you need to be ready for Friday’s workshop on E-campus.

06-2012

New pamphlet, forms
       
The CAAT Pension Plan website has been updated to reflect the new process for marriage/spousal relationship breakdown.

Members can be directed to the pamphlet and forms now online

The website updates reflect the new process that took effect January 1, 2012 to comply with changes to family law and pension legislation.

The updates include:

• A new pamphlet designed to guide members through the process
• An updated “Life Events” page with links to the Financial Services Commission of Ontario (FSCO) forms to be completed by the member and spouse or former spouse

If any of your members have questions about marriage breakdown and how it affects their CAAT Plan pension, please refer them directly to our website to access the pamphlet and the forms, or provide them with a print copy of the pamphlet. If necessary, we will contact you to obtain the data needed to calculate the value of the member’s pension.

Here are links to the new web pages, which apply to both active and retired members:

Life events page: Separation or Divorce (with links to FSCO forms)
Pamphlet: Your pension and separation or divorce

Print copies of pamphlet being shipped

We are shipping a small quantity of the new pamphlet to you for distribution to interested members. Please contact us if you require additional copies. Remember to recycle any copies of the old marriage breakdown pamphlet you have on hand.

Refer to our December 22, 2011 Employer Update for a summary of the 2012 changes and contact your Pension Analyst if you have any questions.

05-2012

Takes place Friday, February 17 from 9: 30 to 11:00 a.m.

Our annual Data Collection Tool workshop will be even more important this year because of the initiatives coming up in 2012.

We’ll kick off this year’s workshop by providing you with an overview of what’s in store:

One of the first initiatives we are undertaking this year is a review of the Pensionable Earnings guidelines. Our goal is to improve consistency and efficiencies across employers. We have been working with a small group of employers over the past few weeks and are now in the process of developing draft guidelines that will be sent to you shortly. At the start of the workshop we’ll be answering any questions you may have arising out of the draft guidelines.

We’ll also take a few moments to give you a brief update on the changes to next year’s Data Collection Tool that will take us closer to our goal of implementing Active Payroll.

To participate in this webinar, you’ll need access to a telephone and a computer with Internet access using a browser running Microsoft Internet Explorer v7.0 (or higher), or Firefox 3+. Please confirm with your IT department in advance, if necessary.

Please register by replying to this email with the names of the attendees by Friday February 10, 2012. We will contact registered participants with the call-in details, password and log-in instructions in the days leading up to the workshop. We'll also email you a copy of the agenda and the presentation in advance.

We encourage anyone with pension responsibilities – whether human resources or payroll – to participate in this important workshop.

04-2012

In September 2011, we issued instructions that purchases of the 2011 strike period were to be excluded from PAs/T4s and that the Plan would calculate Past Service Pension Adjustments (PSPAs) for these members.

We have since clarified that, for purchases completed by April 30, 2012, the process of including the purchase in the PA for the year complies with Canada Revenue Agency rules. The steps in that process are:

• Calculate the PA based on the member’s basic earnings plus the purchase (strike) earnings
• Report only the contributions that the employee made on basic earnings as RPP contributions on the T4 slip
• If the member paid cash to the Plan directly, we will issue a receipt to the member. If the purchase was made with RRSP funds no receipt will be issued.

Where the purchase is made after T4s have been issued and before April 30, issue a revised T4 following the above steps.

Please follow this process for 2011 strike purchases completed by April 30, 2012. If you already followed the earlier instructions for members who purchased the strike and have since retired or terminated you don’t need to do anything more. The Plan will calculate PSPAs for these former members.

For members who purchase the 2011 strike period after April 30, 2012, the Plan will calculate the PSPAs for these members. Please ensure the request for the PSPA is made before the member issues a cheque.

HAPE - actual earnings in first year of HAPE period no longer required for OTRFT members
Last year, we introduced a new procedure for calculating the Highest Average Pensionable Earnings (HAPE) for both Full-time and Other than Regular Full-time (OTRFT) members. This required you to provide additional earnings information on the Pension, Termination and Death benefit application forms.

As of this year, this procedure is no longer required when completing the application forms for OTRFT members. The procedure for reporting the earnings in the first year of the HAPE of Full-time members will not change.

For OTRFT members you no longer need to provide the actual earnings and months of service for the first year of the final five year (HAPE) period. For these members we will use their annualized earnings and prorate them for the first year of the HAPE based on the actual months in the calendar year that they were in the Plan, so the additional information is not required.

HAPE – ‘higher of’ calculation for 2006 earnings no longer applies
Last year, for members who retired between April 1, 2011 and December 31, 2011 the earnings we used for the 2006 year of the HAPE period were the greater of: the prorated earnings, including purchased earnings, and the actual earnings in respect of the months of the HAPE period only.

With 2006 no longer included in any Highest Average Pensionable Earnings (HAPE) calculations that align with the last 5 years (60 months), we have stopped performing the ‘greater of’ calculation. Instead, we will use the actual monthly earnings for the first year of the HAPE.

We will update E-Campus to reflect both of these process changes, including posting updated Pension, Termination and Death Benefit Application forms.

Please contact your Pension Analyst if you have any questions or concerns.

03-2012

The “pension calculator” function of the Employer Pension Estimator has been restored. Please note that the commuted value and buyback functions will remain unavailable until further notice.       
               
Member Pension Estimator is reliable for many estimates

Based on some of the questions we’ve received during this service interruption, we have noticed that many of you are concerned about the accuracy of the member “3-Step” Pension Estimator. Although the Employer calculator requires more detailed information to be entered than the Member version, the variance between estimates produced by the two calculators will not be material to selecting a retirement date.

If you have members who are considering retiring within 5 years, we will continue to provide you with more accurate estimates based on different retirement dates to assist them in their decision making.  Please contact your Pension Analyst to request these estimates.

We recommend replacing any bookmarks or favorites you have set for the employer tool with a link to the Member Pension Estimator. Using the Member Pension Estimator reduces the risk of downtime as the employer calculator is maintained by an external service provider who may experience issues not related to CAAT. It also offers the added advantage that estimates you provide to members will align with any they might run themselves. And, it provides the opportunity to demonstrate to the members how easy it is to run an estimate so they can do so in future without needing your assistance.

Commuted value and service buyback calculators being reviewed

For some time, we have been considering removing the commuted value calculator and service buyback estimator from the employer tools altogether.

Commuted value calculations can change dramatically over a relatively short period of time due, for instance, to fluctuations in interest rates, and therefore can mislead members in advance of termination.  We will be developing a “making choices” booklet to assist members in making an informed choice about whether to select a commuted value transfer or take a deferred pension at termination.  

The Actuarial Cost Estimator (ACE) tool available in the member section of the website produces estimates for buybacks, using fewer steps than the employer tool, and yields results that are reliable for members to decide if they wish to pursue a purchase.

A final decision on the removal of these tools will be made within the next few weeks. If you have any input on this issue, please let us know by reply e-mail or by contacting any of the following staff members:

• Your Pension Analyst
• Kathleen Riddell at (416) 673-9045
• Tracey Leask at (416) 673-9009

We welcome your comments and thank you for your continuing patience as we work through issues with our vendors.

002-2012

The 2012 Pension Adjustment (PA) and Contributions calculator is now available on our website. You can now use it to calculate member contributions and PAs for 2012 and previous years.

The updated PA calculator reflects the 2012 contribution rates and updated YMPE, along with the change from a 3-tier to a 2-tier calculation method. For instructions on calculating PAs, consult the PA calculator Help page or contact us.

Active Payroll update – clarification

Further to the December 22 Employer Update on the Active Payroll status, here is some clarification on the dates.

Our original plan was to launch Active Payroll on January 1, 2012, however we will be delaying implementation while we work on resolving some standardization issues. In the meantime, we are making modifications to the 2013 Data Collection Tool (for 2012 member data). These changes will be communicated to you later this year and launched early in 2013.

New-look Employer Update

We hope you’re enjoying our redesigned Employer Updates. Along with the new look we’ll be streamlining the content to make sure you get the news you need as quickly as possible. For your reference, we’ve introduced a new numbering system that you can find in the bottom left corner of this email.

In the coming weeks we’ll also be making changes to the Employer Update page on our website to improve the search function and make it more of a useful resource. Please tell us what you think of our new look and be sure to let us know if you experience any problems displaying this email.

01-2012

On January 1, 2012 family law and pension legislation changes come into effect for the treatment of pensions upon the breakdown of a marriage or other spousal relationship. The new rules, which apply to new cases as well as past cases without a pre-2012 legal agreement covering the division of pension, bring these key changes:

• The Plan will be required to calculate the Family Law Value of a member’s pension accrued during the relationship, using prescribed formulae, and provide this to both the member and their spouse/former spouse. (This change spares both parties from the current practice of hiring actuaries to independently value the pension and then negotiating the valuation methodology as part of reaching an agreement on division.)

• Immediate settlement of benefits to a former spouse where they and the member agree or are required to divide the member’s pension. (Under current rules the former spouse does not receive their portion of the member’s pension until the member terminates or retires.) Though settled immediately, the former spouse’s share must be transferred to a locked in retirement account until retirement age.

Members, their spouses and the Plan will be required to use several detailed forms created by the Financial Services Commission of Ontario (FSCO) throughout the process of applying for a valuation through to instructing the Plan on their decision about the division of pension.

The changes introduce considerable administrative responsibilities for the Plan which we have been preparing for in anticipation of the January 1st implementation date.

For employers, your involvement in these cases should be limited to providing partial years’ earnings, service and contributions data during the relationship, which we will request from you. The member and their spouse/former spouse will deal directly with the Plan to obtain the value of the pension and instruct us on its division. This will protect their privacy and save you time. Members going through this life event should be referred to our website for information about the rules, the process and access to the forms they will need to complete. 

We will update you when this information has been posted to our website, expected to be early in January, after FSCO finalizes their forms. In the meantime, please contact your Pension Analyst if you have any questions.

As we approach the end of 2011, we would like to give you a brief update on the status of the Active Payroll activities that we began early this year. In October, we took a step back to evaluate significant issues with the treatment of service and earnings for pension purposes and their impact on the implementation of payroll data collection.

During 2012, we will be undertaking a number of initiatives that will address some of the inconsistencies across the system and move us towards more standardized data collection. Next year will also bring a number of legislative amendments that will result in changes to current practices.

In order to address these issues and successfully launch Active Payroll while minimizing the impact on employers, we have adjusted the timing of implementation, and will not fully launch Active Payroll on January 1, 2013. We will be making some major modifications to our Data Collection Tool in 2013 to capture the data we require to manage the Plan effectively.

We would like to recognize the significant effort of the Payroll Advisory Group who shared their support, advice and suggestions. Their time and effort put into the Active Payroll project to date has been extremely valuable.

We will be communicating further details to you early in the New Year. For now, we would like to thank you for your continued support and wish you the best of the holiday season.

Please take note of the following rate information, updated for 2012.

2012 YMPE

The Canada Revenue Agency has increased the Year's Maximum Pensionable Earnings (YMPE) to $50,100 for 2012.

2012 Contributions changes – Reminder

Effective January 1, 2012:

• Member and employer contribution rates will increase by 0.8%.
• Contribution rates will be calculated using the 2-tier method; contributions will be made at the lower rate on earnings up to the YMPE, and at the higher rate on earnings above the YMPE. The $3,500 threshold has been eliminated.

11.1% of earnings up to $50,100, plus
12.9% of earnings in excess of $50,100

We will notify you when the online PA calculator has been updated to reflect these changes.

2012 Pension Adjustment

Maximum Pension Adjustment (PA): $23,220 (based on formula of (9 X BE) - $600.00)

Maximum benefit entitlement (BE): $2,646.67

If you have additional questions, contact us.

January 1, 2012 pension starts

If the Plan receives completed Option Documents by noon on Monday, December 12th, we will guarantee a January 1, 2012 pension setup. Option Documents received after that time will not be guaranteed to be set up for the 1st of January.

Member information deadlines

Thursday December 1, 2011 is the deadline for submitting the following completed forms to the CAAT Plan so that 2011 member data is entered into the Data Collection Tool (DCT):

• All Pension Membership Enrolment forms that have not already been submitted for individuals who enrolled in the Plan in 2011.
• All Change of Information or Beneficiary forms that reflect changes to member information in 2011.
• All Notice of LTD/WSIB forms for those who went on Long Term Disability or returned after having been on Long Term Disability during 2011. Please remember that you do not have to remit contributions for and on behalf of members during their first 12 months of Partial WSIB.
• All buybacks that took place in 2011, including all Leave of Absence forms and Pregnancy/Adoption or Parental Leave forms for leaves that took place in 2011.

If we receive these completed forms by the December 1 deadline, we can ensure 2011 member data will be entered into the DCT.

The DCT timetable and Active Payroll

As you know, we are in the process of planning the Active Payroll requirements and working on an implementations schedule. To that end, the year-end DCT process will continue to be used to collect member data until employers have implemented Active Payroll as the primary means of submitting member data to the Plan.

Our goal continues to be the delivery of Annual Statements to members by the June 30, 2012 deadline. The 2011 DCT will be available starting Wednesday February 1, 2012, and the deadline for submitting data to the Plan will be Friday March 16, 2012.

Holiday Hours

The CAAT Plan office will be closed starting Monday December 26th, 2011 and will reopen on Tuesday January 3, 2012.

As we implement a two-tier contribution rate formula for 2012, we will also implement a new annualization method: a change in the way contributions are calculated on each pay.

The changes result from an overall review of Plan processes, with the goal of improving equity among Plan members. We are also attempting to more closely align our administrative practices with the Plan text. Changes will be made in a number of stages, leading up to the implementation of Active Payroll, our new payroll based reporting system. We hope to have any administrative changes in place and well understood by our employer group before Active Payroll is implemented.  

Under the annualization method, contributions will be calculated on both tiers (i.e., below and above the YMPE) in each pay. An equivalent amount of contributions will be deducted in each pay period throughout the year. At year end, members will have paid an identical amount of contributions under the new method as they would have under the old “step rate” method. However, for those who join or leave the Plan in the middle of the year, the new method will eliminate under- and over-payments, and will result in members paying the same amount for the same pension, thereby improving Plan equity.  Most pension plans in Canada use the annualization method, and we expect all payroll providers will understand it.

Procedure

The new contribution rates, two-tier format, and annualization methodology will start with the first pay period in the new year, even if your first pay period of the year includes days from 2011.

How to calculate annualized contributions

Visit E-Campus to download the Contribution Calculation Worksheet that will calculate contributions for you. The method is as follows:

Full-time members

• Start with the number of pay periods in the year. You will use this number throughout.
• Calculate the pay period YMPE by dividing the YMPE by the number of pay periods in the year (e.g. if pays are bi-weekly, then number of pay periods is 26).
• Then for each member, divide the annual salary rate in effect during the pay period by the number of pay periods in the year.
• Determine the pay period earnings up to the pay period YMPE and in excess of the pay period YMPE.
• Calculate the contributions on each tier of earnings.

In this example, assume a bi-weekly payroll with 26 pay periods in the year. The member is paid $96,000 a year. The 2012 YMPE for this example is assumed to be equal to the 2011 YMPE of $48,300.

Other Than Regular Full-Time members

Other than regular full-time (OTRFT) members will have a slightly more complex calculation. Details on how it will work will be communicated in the near future. We want to ensure the full time calculation is understood before introducing the OTRFT calculation.

We will be organizing a conference call with our administrators to discuss the full time calculation. Further information about the call will be available soon.

Consistency and accuracy

This change is a result of our ongoing efforts to improve equity in Plan provisions for all members. The new method will resolve some additional issues of inequity concerning intergroup transfers and concurrent employment entitlements, and reduce the need for end of year adjustments. Contributions will be more stable through the year under the new method. There will be greater consistency and more accurate remittance of contributions.

Visit E-Campus for more, including the Methodology - a comparison of Step rate vs Annualized calculations

Communicating with members

We will make members aware of the changes in the Fall Newsletter, which will be emailed in October, and available on our website at that time.

We’ve been getting a few questions from you about how the cost is calculated for the purchase of the 2011 CAAT Support strike. Here are some more details about the calculation.

The cost for the purchase of the strike is 2 times member contributions for the period of the strike, based on

• the annual rate of payas of August 31, 2011
• the 2011 YMPE, and
• the contribution rates in effect at the date of purchase.

Methodology

Based on the annual rate of pay at August 31, 2011, the daily contribution rate based on 365 days in the year is determined.

This daily rate is multiplied by the number of calendar days of the strike (19). This number is multiplied by 2, because the member pays 2 times their contributions.

This method ensures that members pay the appropriate amount for the purchase using the blended contribution rates rather than just the high rate. It is also in compliance with the provisions of the Plan text where service is credited by month and year, not day (or working day).

It ensures all employees are treated the same, regardless of their work schedules.

Note that for members who purchase this service after 2011, the calculation will use the new 2-tier contribution rates in effect in the year of purchase.

The examples below show how the cost is calculated. You’ll note that for Example 1, where the member’s annual rate of pay is less than the YMPE, the purchase cost does not consider the high contribution rate at all. For Example 2, where the member’s annual rate of pay is above the YMPE, the cost of the purchase does take into account the high contribution rate on the earnings in excess of the YMPE.

Deemed Strike Earnings

The deemed strike earnings that CAAT will include in the member’s 2011 earnings will be based on the following calculation:

19/365 x annual rate of pay = strike earnings posted by CAAT

Example 1 – Member annual rate of pay is less than YMPE

Example 2 – Member’s annual rate of pay is above YMPE

PAs, PSPAs and Tax Implications

Like all service purchases, the strike purchase may create a PSPA for members. Here is the procedure for reporting PAs and PSPAs for the members:

PA/T4 – On the member’s T4, report only the earnings actually paid to the member, not the deemed annual rate of pay. For contributions, report only the regular contributions made by the member, not the strike purchase.  Calculate the PA based on the actual earnings for the year.

PSPA– For members who make the purchase, the CAAT Plan will calculate a PSPA and, if any, report it to CRA and the member. The Plan will provide a tax receipt to the member for the purchase. If the member pays for the purchase by RRSP transfer, the PSPA will be offset by the amount of the RRSP payment and only the balance will be sent to CRA for approval. PSPAs that are under $50 do not need to be reported to CRA.

During the recent OPSEU CAAT Support strike (September 1 – 19), members of the Plan who participated in the strike did not make contributions to the Plan. They remained members during the strike period, however any payments received while on strike are not considered pensionable earnings in the Plan.

The strike period is considered a break in service and can now be purchased.

Because of the “one day rule” under the pension plan, a full time member who works and contributes to the plan for at least one day in a given month will earn that full month of service. Therefore members who participated in the 2011 OPSEU CAAT Support strike, earned service for the full month of September because they worked and contributed to the plan in September after the strike ended. However, since they did not receive pensionable earnings for the period of time of the strike  pensionable earnings for September will only reflect the actual earnings from the return to work.

All OPSEU Support members who are interested in making the purchase should read the latest "Making Choices" booklet, now available online  and as a downloadable pdf.

For members who are more than 5 years away from retiring or terminating, a service purchase will likely not impact the ultimate retirement pension, as the highest years of earnings are typically the last 5.

We suggest members seek independent financial advice before making this, or any service purchase.

How to purchase strike service

The cost of purchasing the strike period is 2 times member contributions based on:

• The member’s annual rate of pay at the beginning of the strike, and
• The contribution rates in effect at the time of the purchase

The cost is 100% payable by the member, and the payment must be made in a lump sum. The member can make the purchase at any time up to termination or retirement.

Note that the cost of the purchase will increase when contributions increase, as they are scheduled to do in 2012, 2013 and 2014.

To purchase the service, the 2011 CAAT Support Strike purchase form must be completed. (This form is an Excel spreadsheet which calculates the cost of the purchase automatically when the annual rate of pay before the strike is entered.)

To complete the form

• Enter your employer name
• In Section A enter the member’s name and other information, including the home mailing address and phone number.
• In Section B enter the member’s annual rate of pay before the strike period.
• The form will calculate the cost of the purchase shown in the line “Strike purchase cost” at the bottom of Section B.
• Save and print the form: both the member and a representative of the employer must sign the form (Sections C andD).
• Have the member write a cheque for the entire strike purchase cost, payable to the CAAT Pension Plan. The purchase must be made in a lump sum. Send the completed form and the cheque to the CAAT Pension Plan.

Update #99

Your Member Handbooks are in the process of being shipped to you for distribution to your members.

The up-to-date Handbook now includes Plan provisions to August 2011 as well as a new look to showcase our current logo and visual identity.

In a separate shipment in the coming weeks, you will also receive copies of our updated Pamphlets, and copies of our new “Making Choices” booklets. These smaller-sized publications are ideal for helping members make important decisions about their pensions.

All of our new publications are available on our website, which has also undergone a refresh in time for the new school year. Members who prefer electronic publications can read them online or download the PDF versions.

If you would like additional copies, please contact us to let us know. With our new “print on demand” model, we can print and ship the quantity you need. Please allow up to 2 weeks for delivery.

For your convenience, a list of the new publications and when to use them can be found on E-Campus.

#98 August 10, 2011

Over the past several months, we’ve revamped the content and look of our pension handbooks and our most popular pamphlets. We’re pleased to announce that they’ll be on their way to you soon.

Print on demand – a better way to send publications
To control costs and limit the use of resources, our print publications have moved to a “Print on demand” model. This allows us to print and ship the exact quantity that you need, when you need them. We’ll be able to make changes to print publications as they occur - shortening the period between updates and ensuring you and your members have access to the most up to date material possible.

To order publications, send email caatpensionplan@caatpension.on.ca to let us know how many copies of our publications you need, and we’ll print and ship them to you.

As usual, all of our new and updated publications will be posted on our website as soon as they are available, for members who prefer the convenience of an electronic document.

The following publications will be available soon:

• Member Handbook
  The long-awaited Member Handbook was last updated in 2008 and has undergone a major overhaul. It now contains up-to date information about membership in the Plan in a more streamlined format. The new Member Handbook is meant to work in conjunction with our updated pamphlets, to provide members with further details on specific provisions for those who want them. If you haven’t recently sent us a request for Member Handbooks, please let us know how many you need for your new members. We will start shipping them later this month.
• Pensioner Handbook
  The Pensioner Handbook is a comprehensive guide to life as a CAAT Plan pensioner, which we include in each retirement package. We have recently started shipping the updated Pensioner Handbook to the homes of pensioners who have retired within the past few months. If you would like a few copies for your reference, please let us know.
• Pamphlets
  Several of our pamphlets are in the process of being updated, to give members more details about specific provisions of the Plan. They include “Transfers”, “OTRFT membership”, “Pre-retirement Survivor Benefits” and “Purchasing Service”.
• Other publications
  We’re working on several new ways to reach members and answer some of their questions about their choices in the Plan. Our goal is to make sure members have all the facts so they can make informed decisions about their pensions.

French publications
We will be staggering the printing of these documents, and in some cases, French versions will be available after the English publications have shipped. When ordering publications, please let us know how many copies you will need in each language.

E-Campus
We recently added “Working past 65” to E-Campus. This page offers best practices for hiring and re-hiring employees over the age of 65 and explains how to determine contributions if a member over 65 stops contributing to the CPP.

Employer Updates
Since 2006, Employer Updates have proven to be one of the best ways to reach you with a timely and consistent message. We’ll be approaching our 100th Update soon and to commemorate this milestone we’ll be unveiling a new-look Employer Update email and web page. Keep an eye out for upcoming messages from the CAAT Plan - we hope you’ll be pleasantly surprised!

#97 August 9, 2011

Join us for a status update on the Plan’s move to payroll based reporting.

The teleconference will take place on Thursday August 18 from 10:00 a.m. to 11:00 a.m.

During the hour we’ll update you on the progress of the Active Payroll project:

• Review the outcome of the working session we held with the panel members in June
• Answer the questions you submitted about the file format and the testing rollout plan
• Update you on the progress of the initial phase of testing

To register for this teleconference, please reply to this email. If you have any questions about the teleconference or Active Payroll, feel free to include them in your email.

We will email the teleconference call-in details and the agenda to all registered participants on August 15.

#96 June 30, 2011

Our June 16th “All Employer” teleconference provided an overview of the Active Payroll project. Thanks to all of you who participated and offered feedback and questions. This project will have an impact on pension administration in the coming months, and we appreciate your input.

We also want to thank those of you who submitted the name of the Active Payroll contact person at your organization. Having one point of contact will streamline communications and help make the testing and reporting processes more efficient. If you have not already sent us your contact person’s information, please do so before this Thursday, June 29. If we do not receive the name of one individual by that date, we will assume that the main contact person in our database will also be the Active Payroll contact person.

We had a lively Q&A at the teleconference, which we hope helped answer a lot of the questions you may have about Active Payroll.  The Q&A has been added to our E-Campus page, along with additional questions we received earlier in the month.

We’ve summarized below the E-campus updates that have been made during the month of June. Please keep an eye on the E-campus page for ongoing updates.

#95 June 15, 2011

Due to the Canada Post postal service disruption, we are implementing the following procedure to help minimize the impact on the delivery of pension services.

We will continue to send paperwork to you by courier in order to avoid any interruptions (this includes Annual Statements).

As of Thursday, June 16, we ask that you:

• Send all of the paperwork (e.g. completed forms, option documents, etc.) that you would normally mail to us by fax or by secure email (scan the original document and send by encrypted or password-protected email).
• Either mail the original documents to us once the service disruption is over, or send them to us by courier. 
• For terminations with a lump sum cash payment owed to the member, we will courier the cash portion directly to the member. The transfer amount will be transferred by CIBC Mellon to the member’s Canadian financial institution.

Pensioners: Almost all pensioners receive their pension payments via direct deposit. The next pension payments are due July 4. We are closely monitoring the Canada Post situation. If the postal service disruption is still in effect in late June, we will act to ensure that those who normally receive cheques by mail will receive their July payment on time.

#94 June 6, 2011

Join us for a status update on the Plan’s move to payroll based reporting.

The teleconference will take place on Thursday June 16 from 10:00 a.m. to 11:00 a.m.

During the hour we’ll discuss the Plan’s move to Active Payroll, review the activities of the employer Advisory Panel to date, and explain the next steps in the process for all employers.

Please take a moment to consider if other members of your organization should sit in on the teleconference: it’s important that representatives from your HR, payroll and possibly your IT departments be in attendance.

To register for this teleconference, please reply to this email. If you have any questions about the teleconference or Active Payroll, feel free to include them in your email.

We will email the teleconference call-in details and the agenda to all registered participants on June 10.

[Veuillez noter que la téléconférence n'est offerte qu'en anglais]

#93 May 24, 2011

Representatives of all employers will have a chance to ask questions about the Plan’s move to Payroll Based Reporting at a June 16 teleconference.

To date, we have had one teleconference with the employer members of the Payroll Advisory Panel, with a second scheduled for May 26. The Panel has shared information about employer identifiers, and data submission issues concerning pay periods, employment periods, file adjustments, and OTRFT eligibility. Developing a standard file format for data submission is the current key focus of the project.

More details concerning the discussions and any decisions that have been made will be available at the June 16 teleconference. We’ll send your invitation to take part at the end of May. Please take a few moments to think about which members of your organization should sit in. It’s important that both the HR and payroll functions, and possibly IT as well, be represented.

Of course, for the new processes to be successful, all employers will need an opportunity to make their specific issues known. Later in the summer, we will be sending out the new file format and conducting one-on-one conversations with each employer, to make sure that issues are addressed. After the June 16 teleconference, we’ll want you to identify the appropriate person for these discussions.

If you already have some questions, you should submit them before the teleconference, to give us a chance to consider the issue. Be sure to check the “Payroll Based Reporting project” page of E-Campus on our website to get the latest news, and to submit your questions.

#92 May 24, 2011

We’re putting the finishing touches on our Spring Report E-Newsletter for members. You can expect to receive it on Thursday, May 26th.

Based on the feedback we received from our recent “E-Newsletter delivery” survey, our switch to electronic Member newsletters has been well received by you and your members. We appreciated your helpful comments and the positive feedback you provided and we’re glad to be able to provide a product that reduces the impact on the environment and on your workload!

The survey identified a few issues that some of you may be experiencing, namely the inability to filter out non-member email addresses and problems displaying images. To help address these issues, we have added a brief message for your non-member employees along with a plain text link to our website for members who wish to skip directly to the online E-Newsletter.

For those of you who have members on leave or unable to view email, please remember that the E-Newsletter can be accessed at anytime on our website. We will also make a few print copies available upon request for you to send to your members who do not have Internet access. If you have already indicated a need for a specific number of paper copies in the past, we will send you the same amount again.

Thank you in advance for forwarding the May 2011 Spring Report Member E-Newsletter on Thursday. Please refer to the E-Newsletter distribution procedure to make sure all of your employees who are members of the Plan receive their copy as soon as possible.

#91 May 18, 2011

A webinar for members has been announced on our website.

On May 31, Derek Dobson, CEO and Plan Manager, will talk about the recently announced contribution changes, the results of the Funding Task Force and how the Plan makes funding decisions.

The webinar is scheduled for Tuesday, May 31 from 12:30 to 1:30 p.m., with a presentation by Derek followed by a question and answer period.

Click here for more information or to register.

#90 May 18, 2011

As part of the recent improvements to our termination and retirement forms, we are now asking you to report the service and contributory earnings for the relevant months of service in the first year of the final 5 year period of the member’s employment.

We’d like to offer a “best practice” for determining the earnings for that period. This “best practice” is consistent with the methodology that will be used by our new pension system when we introduce payroll based reporting early next year.

Report the pay the member received during the first year for the days in the relevant months only. If the first pay period includes days from the previous month, the pay will be broken down by days.

For example:

• For a member retiring on June 30, 2011, report the pay in the first year of the final 5 year period from July 1, 2006 until the end of the year. If the first pay of July 2006 is for the pay period of June 25 to July 8, then prorate the pay for that payroll period as follows:

Bi-weekly pay:	$2,800
Days in pay period (depends on payroll frequency):	14
Days in first pay period of first month of final 5 years:	8
Pay to be used in first pay period of July:	$2,800  x (8 / 14) = $1,600

• Report the actual pay received for the rest of the year up to and including the last complete pay period of the year even if that final pay period does not include the final days of December. The pay for the final days of December will be included in the final 5 year period as it will be part of the pay period of the following year.

For Other Than Regular Full-Time members, please report this additional information for the first year of the final 5 year period:

• Actual hours worked that correspond to the earnings reported for those months
• Full-time equivalent hours for the months included in the first year of the final 5 year period.

#89 May 12, 2011

Earlier this year, we told you about the many changes we have in store. We’ve been working on ways to keep you up to date and give you access to all of the resources you’ll need.

Inspired by the colleges themselves, we’ve created E-Campus - a collection of articles about the information you need to know now, all in one location.

What is E-Campus?

E-Campus is your one-stop resource
Everything you need to know about our Plan changes and current projects can be found here. E-campus pages are topic-specific so you can find what you’re looking for at a glance.

E-Campus puts the focus on training
Get access to best practices, tips, and “how to’s”, all in one place.

E-Campus takes the guesswork out of finding the latest news
Simply bookmark the E-Campus page and visit it often to stay up to date on Plan changes and how they will be implemented.

E-Campus keeps you up with the changes you can expect this year
Only our current and ongoing projects will be featured in E-Campus. New sections will be added as required.

E-Campus reminds you about upcoming events and procedures
What time is that teleconference? When is that deadline? Find out easily by selecting the appropriate E-Campus page.

E-Campus answers your questions!
Our Payroll Based Reporting (PBR) project and the Payroll Advisory Panel are currently underway. If you’ve got questions, send them to us, right from the website. We’ll either reply to your question directly, or add the answer to the Q&A section for everyone to consult.

Right now on E-Campus

You’ll find links to the Payroll Based Reporting project, with updates on the Payroll Advisory Panel’s work. You’ll have a convenient way to access the changes we’ve recently announced –the new procedures for reporting Highest Average Earnings, as well as updates on the Open Buybacks changes. You’ll also find links to information you’ll need for forwarding the upcoming E-Newsletter.

Get started now!

Start by visiting our website and clicking on Employers / E-Campus. Find the topic that interests you and select it to learn more.

If you have any questions about E-Campus, we’d love to hear from you!

#88 May 11, 2011

At their meeting of March 2, 2011 the Sponsors’ Committee accepted the recommendation of the Board of Trustees to amend the Plan Text in accordance with the recommendations of the Funding Task Force.

The approved amendments are:

•  A change from a three-tier contribution formula to a two-tier contribution formula on a permanent basis starting January 1, 2012.
• A 1.6% increase in the contribution rate to be phased in over three years with the first step (a 0.8% increase) starting January 1, 2012.

The amended sections are Articles 4.01(1.4 to 1.7) along with referenced sections in Articles 4.03 and 4.04.

As a public document, the Plan text is now available for viewing by interested members on our website. Please follow this link to the most up to date version (dated April 20, 2011).

#87 May 3, 2011

CAAT Plan staff conducted a first teleconference meeting with 8 members of the Payroll Advisory Panel on April 20. The initial results are very encouraging.

The Panel is helping the Plan develop its new procedures for contribution and data collection, with a new form of payroll reporting scheduled for implementation in 2012.

As Tracey Leask explained during the teleconference, our goal with the Panel is to engage employers at an early stage, to get their feedback and identify any issues and concerns.

Payroll based reporting will simplify the processes surrounding annual data collection, enrolments, leaves and terminations, will identify any data issues earlier and will allow us to use more current data when generating pension estimates and annual statements.  Ultimately it will give us the flexibility and timeliness to facilitate member self service on our website.

During the meeting, the Panel also discussed challenges concerning eligibility and data collection for OTRFT employment.

Some volunteer employers from the Panel will be taking part in a payroll based reporting pilot project that will run during the last quarter of 2011.

We will keep you up to date as decisions are made concerning these important changes to our Plan.

Membership Certificates

Please note that as of May 1, 2011, we will no longer send Membership Certificates. Members will receive confirmation of their enrolment and any changes they make to their personal information through their Annual Statement, which provides a variety of useful information.

#86 April 5, 2011

We were pleased with the responses we received with respect to our request for volunteers for the Payroll Advisory Panel. We believe that the following individuals, who make up the Panel, provide a good cross-section of the college system and will represent the interests of all employers.

Our goal in forming the Payroll Advisory Panel is to involve you in the implementation of the upcoming changes to contribution and data collection and to get a better understanding of the impact these changes will have on your role as pension administrator.

We will keep you informed of the Panel’s progress.

#85 March 22, 2011

As part of our ongoing review of administrative procedures, we have determined that the current method of calculating the Highest Average Pensionable Earnings (HAPE) for the pension, termination and death benefit calculation is inconsistent with the strict interpretation of the Plan Text and could be subject to challenge. Following a substantial analysis, we must implement a new procedure for collecting members’ earnings data, starting immediately.

Definition of HAPE

“Highest Average Pensionable Earnings” are defined in the Plan Text as the average of the pensionable earnings for the 60 consecutive months when earnings are highest. To calculate the HAPE, our current practice relied on pro-rating the annual earnings data that you provide to us each year as part of the data collection process.

Existing procedure

As most members do not leave the Plan in December, we needed to prorate their annualized earnings in the first year and final year of the 60 month HAPE period. For example, if a member’s HAPE period includes the first six months of 2011 (as in the case of a June 30, 2011 retirement), it will also include the last six months of 2006 and the four complete years in between, to calculate the 60 months average. To calculate the HAPE using this example, we would divide the member’s 2006 earnings (which you would have provided to us as part of the data collection process) into 12 equal portions. We would then combine 6 of those prorated portions with the member’s actual 6 months of earnings in 2011 to make 12 months.

Calculating the HAPE in this manner is a standard industry practice for pension plans that collect data annually. However this method of calculating the HAPE is not strictly consistent with the language in the Plan Text. In some cases this proration method may understate or overstate the member’s HAPE, and subsequently their pension.

The HAPE change

We are changing our method of collecting earnings data in order to base the HAPE calculation on actual data for 60 months, particularly the first period of the member’s HAPE. For the purposes of this change, we are assuming that the HAPE years are the final 5 years of membership. Where they are not, we will analyze the earnings information already on file pertaining to the employee’s entire pension membership to determine what the HAPE will be. We are making this change to ensure better compliance with the Plan Text.

The new procedure

Report service and contributory earnings for the months of service in the first year of the final 5 year period of the member’s employment

To collect this data, we have revised our Termination / Retirement / Death (TRD) form. This change has allowed us to replace the 3-page TRD form with 3 separate forms, each specific to an event:

• a Pension Application form,
• a Termination Benefit Application form, and
• a Death Benefit Application form.

Each form will contain a new section in which we will ask you to report the earnings and service details for the first year of the member’s final 5 year period of employment. Using the example outlined above, on the Pension Application form for a member who retires on June 30, 2011, you will provide us with their total actual earnings for the last 6 months of 2006 (July 1 to December 31, 2006). When we calculate the HAPE, we will add this amount to the member’s current year earnings (January 1 to June 30, 2011 for this example), which you will continue to report on the form as usual. For the 4 full years in between, we will refer to the earnings that you have previously reported to us during the annual data collection process.

These new forms are now available on our website. Some minor changes will also be made to the online Administration Manual for your reference, to reflect this new procedure.

Some of you may remember this method as the way the HAPE data was collected in the past. During our review, we determined that this method is more consistent with the Plan Text, and provides a more accurate rendering of the HAPE used in the pension calculation.

Terminations and Retirements already in process

If you’ve already sent a TRD Pension claim for a retirement date of March 31 or later, please email your PA with the information requested in Section B of the new Pension Application form.

Looking forward

For members retiring between March 31, 2011 and December 31, 2011 we will use earnings for the 2006 year of the HAPE period which are the greater of:

1. the prorated 2006 earnings which include the purchased earnings, and
2. the actual 2006 earnings in respect of the months of the HAPE period only

If the final 60 months are the member’s highest 60 months, the strike purchase will no longer have an impact on the calculation, therefore, there is no further reason for affected members to purchase the 2006 strike period.

We are undertaking a comprehensive review of past pension calculations to see if any remediation is necessary. The results of this review are expected later this year.

For now, we will continue to collect member data on an annual basis. This review of our HAPE calculation is part of our overall review of all our procedures. Our goal is to ensure compliance with the Plan text, consistency across our processes and where possible to also increase efficiency. We expect further changes to practices will arise, and we will do our utmost to minimize the impact these changes will have on plan administration. If you have any questions regarding this or any other issue please be sure to contact us.

Retirement Advance Election

With the introduction of the new Pension Application form, we have taken the opportunity to change the longstanding practice of providing a Retirement Advance Election to single members at retirement.

Members who do not have a spouse at retirement receive a pension payable for their lifetime, which provides for a 60% survivor benefit should they marry after retirement. These members do not have a choice of the form of pension they will receive. Because there are no optional forms of pension available, they have had the opportunity to make a Retirement Advance Election when they signed off on their TRD form.

However, as part of the retirement process all members should review their pension option documents in order to make a fully informed decision before signing-off on their pension. Members who don’t do so will be unaware of the data used in the calculation of their pension, the actual amount of their pension payments, possible bridge benefits (as well as bridge end dates), and retirement reductions if applicable.

Pensions processed with the Retirement Advance Election do not necessarily start sooner than they otherwise would, and there is no material advantage to members who make this choice. In fact, we believe that these members are disadvantaged by not having all the information they need to have before starting the pension.

As a result, we are no longer offering the Retirement Advance Election option for single members at retirement and have removed the reference to it in the new Pension Application form.

Update #84 March 21, 2011

As you know, we’re in the process of making a number of changes at the CAAT Pension Plan. Many of these changes will have an impact on your role, as we simplify and streamline processes and procedures.

We have begun work on a project to change the processes for collecting pension-related data. Our goals are to have more timely data and reduce administrative work for employers and the Plan. 

You may know that we recently conducted a survey of your payroll department in January, and that in the next year, will be rolling out a number of changes both to the calculation of pension plan contributions and the collection of member data.

Contribution and data collection changes

1.Change from a 3-tier to a 2-tier contribution rate

            This will simplify the Plan, making it easier to explain and less costly to administer.

2.Change to an annualized contribution calculation from the current “step-rate” method

This will simplify administration and minimize under- and over-payments especially for concurrent members and intergroup transfers

3.Introduction of payroll-based reporting

This will eliminate the need for one major annual data update process, and will reduce the amount of data manipulation required by you.

Payroll Advisory Panel

In order to accomplish these changes effectively, we need your help.

We’re looking for volunteers to join our Payroll Advisory Panel. The panel will be launched in early April, and will include up to 6 representatives from your Payroll or HR departments. Panel members should have in-depth knowledge and experience both with your payroll system and the pension plan. This is your opportunity to provide your input and share your ideas on upcoming contribution and data collection changes so that we understand any potential administrative challenges before the changes are implemented.

Your time commitment

We respect your time and want to make it easy for you to participate: The Panel will kick off with a teleconference to introduce the changes, outline our goals and take note of the challenges we can expect to face (scheduled for April 14). Panel members can plan on at least one full-day working meeting at our office in Toronto sometime this summer. Additional meetings, if necessary, will be conducted by teleconference or webinar.

If you are able to devote some of your time to help us make these changes smoother for everyone, we’d love to hear from you.

How to apply

Please reply to this email (caatpensionplan@caatpension.on.ca) with your name, and a brief summary of your experience with Plan contributions and payroll. We’ll select 4 - 6 volunteers to sit on the panel, representing a demographic cross-section of our employers.

We hope to be able to harness your expertise in future panels, on a variety of subjects.

We’ll be asking for volunteers again and will be sure that everyone who is interested has a chance to participate.

Panel reports

As part of our ongoing commitment to open communication, we’ll be sure to keep you in the loop throughout the process even if you’re not part of this Advisory Panel. We’ll send you occasional updates as we work through these important changes. And, at the end of the process, we will issue a final report of the work accomplished, and the new procedures.

We recognize the ‘up-front’ effort this initiative may present to your organization and appreciate your continuing support as we implement these important changes. Our focus is on operating the Plan efficiently and effectively and ensuring it continues to provide significant value for your organization and your employees.

#82 March 3, 2011

Yesterday, the Plan’s governors approved task force recommendations to eliminate the going-concern funding deficit. The results of the task force’s review are being announced in the March issue of the Member E-Newsletter that has been posted to our website.

Shortly, an e-mail message containing brief highlights that link to the online newsletter will be sent to the administrator who usually distributes the newsletter, for forwarding to your employees. Before that distribution to members gets underway, here for your own information are the highlights of the task force results:

Deficit can be managed without benefit reductions

Updated projections show the Plan is sustainable with only small changes – despite the fact that member life expectancy has climbed to an average of 87.7 years, up 28 months since the last valuation.  An additional $447 million is being allocated to provide the additional pension payments we expect to make due to improved life expectancy.

Contributions to edge up

After careful consideration the task force concluded members would prefer to pay more in contributions to secure benefits than see any benefits reduced. These rate increases, paid by members and matched by employers, will be phased in as shown:

2012: 0.8%
2013: 0.4%
2014: 0.4%

The contribution increases make the Plan’s benefits more secure, partially offsetting the cost of increased life expectancy. Based on economic and demographic conditions and our forecasts no other changes need to be considered for the foreseeable future.

Change to a two-tier contribution rate lowers contributions on first $3500 of earnings

Also being introduced in 2012 is a move to two contribution rates from three. Members will contribute at the same rate on earnings up to the Year’s Basic Exemption as they do on earnings up to the Year’s Maximum Pensionable Earnings. This change has no material impact on Plan funding but does improve fairness for members at all earnings levels in terms of what they pay into the Plan. It also simplifies the Plan, making it easier to explain and less costly to administer.

We are updating the administrative sections of our website and will be provide more detail well in advance of the January 1, 2012 effective date of the changes.

We have tried to anticipate questions with the newsletter content. Please let us know if you have other questions. We also would appreciate hearing about the questions and any other feedback you receive from your employees about the announcement.

#81 February 24, 2011

For the past few years, all of our communications to you, our Employers, have been electronic – either via our website, Employer Updates or Employer Newsletters such as this one. We’ve been committed to finding ways to reduce the use of paper and printing resources, and electronic communication has proven to be an effective alternative. 

We’re pleased to announce that we’re expanding our electronic communications to members. Following the success of our Pilot Project last fall with 13 of our employers, we are implementing electronic distribution for all Member Newsletters. The previous method of distributing paper newsletters will no longer be used.

Our next Member Newsletter will be emailed to you next week. If you are the person in your office who normally receives Member Newsletters for distribution, the email will be sent to you for forwarding to your members. This newsletter will contain important information for members related to the results of Funding Task Force review.

Please let us know as soon as possible if a different individual should receive this email for distribution to members. We appreciate your continued help in making sure each member receives an electronic copy of the newsletter and we ask that you follow the procedure below to distribute the E-Newsletter to your members.

E-newsletter distribution procedure

1. If possible, let your Plan member employees know in advance that they will be receiving their next Newsletter via email. 
2. We will email you the E-newsletter in the body of an email (not as an attachment). The email consists of one main page, with links to each full article on our website.
3. When you receive the Member E-newsletter, please take a moment to review it to make sure it displays properly on your screen. Feel free to click on the links to read the full articles on the member section of our website. If you experience any problems with the way the Newsletter is displayed, please contact us immediately.
4. Forward the Member E-newsletter to all of your CAAT Plan member employees. Please do your best to make sure it goes only to those employees who are members of the CAAT Pension Plan, or let your employees know that the information is meant for Plan members only.

If you experience any difficulties at any time – whether when receiving or forwarding the newsletter – or if the document does not appear to be formatted correctly, please let us know as soon as possible by email to caatpensionplan@caatpension.on.ca or contact our Communications department by phone at 416-673-9000.

Although our goal is to provide all Member Newsletters in this format, we recognize that not all of your members have the ability to read the newsletter online. A limited number of paper copies will be made available and can be shipped to you upon request. Please let us know how many paper newsletters you will need. Our newsletters, as always, will be posted on our website as soon as they are completed.

We’d like to thank the administrators who participated in the Pilot Project, and who took the time to provide us with their feedback. We are excited about providing our members with the ability to read their newsletters in a cost-effective format that is convenient and timely, with less of a negative impact on the environment.

#80 February 23, 2011

Over the past few years we’ve made a lot of changes at the CAAT Pension Plan. We’re focusing on making sure members see the value of their pension. We have recently put several strategies in place that will help ensure we remain viable and ready to face the challenges that may come our way.

One of our objectives is to increase clarity and make our procedures more transparent. We want to make sure we’re responsive to the needs and expectations of our members, while conforming to changes in professional standards, legislation and the pension landscape.

Some of the changes that are taking place will have an impact on your role as pension administrator, as we simplify existing procedures and streamline processes. We’re anticipating changes from your corner too, as a result of a growth in the college system and shifts in member demographics.

Serving you better

To help keep up with the changes and increase our support, we’re hiring a few more Pension Analysts, one of whom will be bilingual. These and other changes will allow us to process enrolments and retirements more efficiently, and enhance our customer service capabilities. 

We are also committed to working with you by scheduling webinars and teleconferences so we can better explain the changes and gather your feedback first hand.

Important changes coming soon

As they arise in the coming weeks we’ll communicate these changes to you via email using Employer Updates. We’re also re-introducing Employer Newsletters so we can better communicate administrative changes. Please be sure to check your inbox often for emails from the Plan. If one of your colleagues should be receiving these emails but isn’t, please let us know, so they can be added to our mailing list.

We’d like to thank you for your continued support as we work towards providing the highest quality of service to our members.  We value your comments and take your concerns very seriously. If you have any questions at any time, please contact us, or call your Pension Analyst.

#79 February 3, 2011

To kick off the 2010 Data Collection Tool (DCT) season, we will be hosting our Annual Statement/DCT webinar on Thursday, February 17 from 9:30 am to 11:30 am.

This year’s webinar will have something for everyone – whether your role is pension administration, payroll or data collection.

As in previous years, Plan staff will provide an overview of the data collection process with a walk-through of the online DCT. Based on your feedback and comments from members, we’ve made further improvements to the look and functionality of our Annual Pension Statements, so you’ll also get a first-hand opportunity to see what’s changed this year.

To register, simply send us an email by Friday, February 11 and let us know the names of the people who will be attending.

To participate in this webinar, you’ll need access to a telephone and a computer with Internet access using a browser running Microsoft Internet Explorer v7.0 (or higher), or Firefox 3+. Please confirm with your IT department in advance, if necessary. A few days prior to the webinar, we’ll send the phone number and instructions for logging in, along with a copy of the agenda and the presentation.

If you’re new to the data collection process, or would like a refresher, be sure to register now! And watch for further training opportunities coming up this year.

#78 January 31, 2011

Several of you have questions about the new Open Buyback provisions and we would like to address some of the concerns that have been raised.

The implementation of the Actuarial Cost Estimator (ACE) Tool on our website was meant to provide members with a “do it yourself” way to get a general cost estimate BEFORE approaching their employer for their records of service and earnings.

For part-time members who express an interest in a service purchase quote: please direct them to the ACE Tool first to obtain an estimate of the cost of the purchase.

If they are unsure of the exact amount of service available for purchase, they should get an estimate for one year of service only. This will give them a general idea of the cost.

• If they find the cost reasonable and are interested in purchasing the service they can download the required form and proceed.

• Those members who find that the cost of purchasing one year of service is prohibitive should not request a formal quote.

If a member has received an estimate using the ACE tool and approaches you with a Service Purchase Application form to request information on their prior employment, please provide it to them if you are able to obtain it.

We understand that there will be cases when records for part-time employees are unavailable or incomplete. We are currently exploring a variety of options to potentially address this issue (for instance T4s, prior contracts) and are conferring with CRA to ensure that our solutions satisfy them while easing your workload.

We will be scheduling an Open Buybacks follow up teleconference in the near future to answer your questions and address any concerns you may have.

#77 January 13, 2011

We would like to make sure that members who move from one employer to another enjoy the seamless continuation of their membership. To accomplish this, members are able to continue to contribute to the CAAT Plan at their new employer, without a break in membership.

We have noted that, in some cases, members who move between employers partway through the year begin to contribute at their new employer as if they were a new member. This may result in an underpayment or overpayment of member and employer contributions (see examples below).

In order to rectify the situation, and avoid any inconvenience to the member or the employer, we recommend the following procedure when a member works at more than one college during a calendar year:

1. The terminating employer will provide the member with the cover memo (click here for cover memo), and a copy of the TRD showing the earnings and contributions at termination, and ask the member to give it to their new CAAT Plan employer at enrolment.
2. The hiring employer will find out if the member is coming directly from another CAAT Plan employer, and ask for a copy of the TRD.
3. The hiring employer deducts contributions for the year based on the earnings with the previous employer and taking into account what the member already contributed for the year at the previous employer.

Note that if the member does not provide the hiring employer with a copy of their TRD, it is likely that contributions to the Plan will be deducted assuming the individual is a new member, and both the member and employer will have to remit shortfalls, if any, at the end of the year.

Examples of Intergroup Transfer Discrepancies

For more information on this procedure, please be sure to contact your Pension Analyst.

#76 January 7, 2011

In an effort to increase transparency and ensure interested members have access to Plan documents, we are now making the CAAT Plan Text available on our website.

The Plan Text is the formal document that details the Plan’s provisions and the rules that govern their administration. Any changes to these provisions, as authorized by the Sponsors’ Committee, require an amendment to the Plan Text.

Follow this link to the recently-updated version, amended as of September 2010. The recent amendments include the following changes related to the adoption of the Plan’s new "Open Buybacks" philosophy:

Allowing the purchase, on an actuarial cost basis of:

• previously excluded full-time, temporary or part-time pre-enrolment service with a CAAT participating employer. [4.04 (1) (c) & (d)].
• pensionable service earned with any other Canadian registered pension plan, including a previously accrued entitlement already transferred into a locked-In RRSP or LIRA (with certain restrictions on pre-1992 service). [4.04 (1) (e) & 4.04(7)].  
• direct transfers-in from Defined Contribution (DC) plans. [13.03]

• The addition of the definition of the term “Non-participating employer” [2.25] and an update to the definition of the term “Purchasable Service” [2.39] have been made to accommodate the amendments.

• Several additional sections of the document have been renumbered and/or reworded to reflect the amendments.

Going forward, subsequent updates to the Plan text will be posted on our website, and we’ll keep you advised via email.

#75 January 7, 2011

At the end of the 2010, we advised you about the new earnings thresholds for contributing to the CAAT RCA.

It has come to our attention that the methodology we proposed for allocating the contributions is unnecessarily complex.

To simplify, please follow this new procedure which will work for ALL members regardless of their 2010 earnings or their salary rate in 2011.

Deduct contributions and allocate them – up to $16,680.04 – to the CAAT Pension Plan (the RPP).  Remit all contributions above that amount to the RCA.

Use of this method means that no contributions will be allocated to the RCA until closer to the end of the year. You will notice that with the much higher earnings threshold, RCA contributions will be smaller than in past years.

If there are allocation issues, for instance, when a member works for less than a full year, they will be rectified during the annual DCT process. 

We are currently looking at ways to streamline and simplify the entire contribution remittance and reporting process, with a goal of making changes for January 1, 2012. We appreciate your patience during this period.

If you have additional questions, please do not hesitate to contact us.