What's New in Pension and Benefits – Spring 2022

1. LEGISLATION

FEDERAL BUDGET DEVELOPMENTS

The federal government released Budget 2022 on April 7, 2022, together with draft legislative language for certain measures, including allowing solvency reserve accounts for federally regulated pension plans and accommodating variable payment life annuities under the federal Pension Benefits Standards Act (PBSA). Proposed Income Tax Regulations amendments, effective April 7, 2022, would give administrators of defined benefit (DB) plans more borrowing flexibility, while the government will also require federally regulated pension plans to disclose environmental, social and governance considerations, including climate-related risks.

CERTAIN DEFINED CONTRIBUTION (DC) PLAN INVESTMENT REQUIREMENTS REMOVED

As of February 11, 2022, amendments to Ontario General Regulation 909 remove some requirements for administrators of pension plans where all the benefits are DC. First, DC plan administrators no longer need to file an audited annual financial statement unless specifically required by FSRA. As well, a SIPP is no longer required for DC plans where members direct all their investments, and statements about the SIPP no longer need to be included in annual/biennial member statements of these plans.

RESERVIST LEAVE CHANGES - ONTARIO

Ontario Bill 88 passed third reading on April 7, 2022, and will amend the Employment Standards Act, 2000 (ESA) allow an employee to take an unpaid leave for military training purposes. The eligibility requirement for this leave will also be decreased to three consecutive months’ employment, from six.