Teachers Guide to The DEFERRED SALARY LEAVE PLAN

Transcription

1 Teachers Guide to The DEFERRED SALARY LEAVE PLAN Information From The NSTU

2 NOVA SCOTIA TEACHERS UNION 3106 Joseph Howe Drive Halifax, Nova Scotia B3L 4L7 Comments on this document are welcomed. Toll free: Revised April 2009

3 Teachers Guide To The Deferred Salary Leave Plan Contents 1. Purpose of Plan Eligibility Requirements Important Dates and Procedures Definition of Terms Federal Government Regulations Benefits to Participants Application Procedure Contract Benefits Status Deferred Salary Leave Plan Contract Extension Request Withdrawal from Plan Financial Information Common Questions References: A Provincial Agreement, Article B Provincial Agreement Appendix B C Community College Agreement, Faculty D Community College Agreement, Professional Support Teachers Guide to the Deferred Salary Leave Plan 1

4 1. PURPOSE OF PLAN The Deferred Salary Leave Plan affords teachers the opportunity of taking a one (1) year or the equivalent of a six (6) month leave of absence and, through deferral of salary for a twelve (12) month period, finance the leave. 2. ELIGIBILITY REQUIREMENTS Any teacher who has a permanent contract with a school board is eligible to participate in the plan. The permanent contract does not have to be a 100% position. Canada Revenue Agency requires employment by the Board for a minimum of five years. 3. IMPORTANT DATES AND PROCEDURES March 1 Withdrawal date from plan April 30 Application deadline June 15 Notification deadline for acceptance or rejection 4 months - Notification prior to leave for withdrawal from plan for Community College members. Deferred Salary Leave Plan Procedures 1. Step One Obtain information booklet entitled Teachers Guide to the Deferred Salary Leave Plan from the NSTU ( ) or also on-line at This booklet contains specific information concerning the plan. 2. Step Two If interested in participating in the plan, make application to the Superintendent of Schools by April 30 th in the year prior to commencement of the plan. Official application forms are available from regional school board offices (Human Resources Department). 2 Teachers Guide to the Deferred Salary Leave Plan

5 3. Step Three By June 15 th of the application year, the teacher applicant will receive written acceptance or denial of the request. If denial is received, the application cannot be pursued as decisions of the school board are final. 4. Step Four If granted, the teacher finalizes all financial arrangements in consultation with staff of the Teachers Plus Credit Union and staff of the employing school board. 5. Step Five Arrange with School Board Payroll Department for payment of premium costs of all insurance benefits and pension deductions prior to entering the leave of absence itself. 4. DEFINITION OF TERMS Source Canada Revenue Agency ATR39 Deferred Salary Leave Plan Eligible Employee means a full-time teacher who has been employed by the Board for a minimum of five years. Leave of Absence means the twelve month period commencing at the beginning of the school year. At no time shall the Leave of Absence be less than six consecutive months. Deferred Compensation Amount means the portion of the Current Compensation Amount which is retained by the Board for the Participant in each year. Deferral Period means the number of years for which compensation is deferred. Teachers Guide to the Deferred Salary Leave Plan 3

6 Participant means an eligible employee who has completed a Memorandum of Agreement and whose application for participation in the Plan has been approved by the Board. Current Compensation Amount means the total compensation payable by the Board to the participant for the year, in accordance with the current collective agreement in force between the Board and the Provincial Teachers Association FEDERAL GOVERNMENT REGULATIONS! The year of deferral cannot commence more than six (6) years from the date of entry into the plan. This permits, at most, a 6 over 7 plan.! Amount deferred in a year cannot exceed thirty-three and onethird percent (33 1/3%) of salary.! To maintain enrolment in the plan, a minimum contribution of 5% of annual salary must be made.! No salary is received from the employer during the leave of absence. Teachers cannot substitute teach with the employing board.! Interest is taxed in the year it is received and paid during the year of leave over the appropriate number of pay periods.! A teacher must return to work for the same employer or one who participates in the same or similar arrangement for time equal to the period of deferral (i.e. 6 months or 1 year).! A teacher who ceases to be employed must withdraw from the plan and all accrued monies, including interest, must be paid to the teacher in one lump sum.! If a teacher ceases to be employed and is employed by another board, all accrued monies, including interest must be transferred to the more recent employer. 4 Teachers Guide to the Deferred Salary Leave Plan

7 ! A period of leave is not counted as insured employment with respect to salary received from the Board. Teachers on a one (1) year plan are not eligible for maternity sub plan benefits the year following their year of leave. Teachers on a six (6) month deferred salary leave plan should check with the Employment Insurance office to ensure eligibility.! All funds deferred must be paid to the employee by the end of the first taxation year commencing after the end of the deferral period. Source ATR39 Deferred Salary Leave Plan, Canada Revenue Agency 6. BENEFITS TO PARTICIPANTS! Income tax is paid on the amount deferred in the year received.! Pension benefits continue to accrue during the period of leave. 7. APPLICATION PROCEDURE! A teacher must make written application to the School Board Superintendent or designate on or before April 30 th of the school year prior to the school year the salary deferment plan is to commence, requesting permission to participate in the plan.! Written acceptance or denial of the teacher s request, with explanation, shall be forwarded to the teacher by June 15 th in the school year the request is made.! Approval of individual requests to participate in the plan shall rest solely with the School Board and a refusal by the School Board to approve an application shall be final and non-grievable. 8. CONTRACT BENEFITS STATUS! While a teacher is enrolled in the plan, and not on leave of absence, any benefits tied to salary level shall be structured according to the salary the teacher would have received had he/she not been enrolled in the plan. Teachers Guide to the Deferred Salary Leave Plan 5

8 ! A teacher s insurance benefits will be maintained during the leave of absence; however, the premium costs of all insurance benefits shall be paid by the teacher during the leave of absence period. Arrangement to be made with School Board officials.! Sick leave credits shall not accumulate and cannot be used during the period spent on leave.! Pension deductions shall be continued during the leave. The leave shall count as pensionable service.! Pension deductions shall be made on the salary the teacher would have received had the teacher not entered the plan or gone on leave.! Effective April 2, 2009, a teacher is eligible to apply for Professional Development grants.! On return from leave, a teacher shall be assigned to the same position, supervisory position; or, if due to declining or changing enrolment patterns, that position no longer exists, the employee shall be governed by the appropriate terms of agreement. 9. DEFERRED SALARY LEAVE PLAN CONTRACT! All teachers wishing to participate in the plan shall be required to sign a contract before final approval for participation is granted. Contract forms are available from all school board offices.! Once entered into, the contract provisions concerning percentage of salary and year of leave may be amended by mutual agreement between the teacher and the Board. Such amendments shall be within the boundaries of the legislation governing the plan. Teachers enrolled in a one year plan THE FOLLOWING WILL BE FORWARDED TO SCHOOL BOARDS:! January of each year of deferral, T4-A for interest for the preceding calendar year 6 Teachers Guide to the Deferred Salary Leave Plan

9 AT COMMENCEMENT OF LEAVE OF ABSENCE Statement sent from Teachers Plus Credit Union to your Board will indicate:! Amount deferred (26 post dated cheques)! Accrued Interest (paid over 26 pay periods)! Total in Fund (total amount deferred plus accrued interest)! Taxable amount per cheque (amount of deferred less interest)! Non-taxable amount per cheque (interest included in cheque) JANUARY DURING THE LEAVE OF ABSENCE YEAR! Cheque for interest August to December (pay-down interest)! T4-A for interest January to December (includes pay-down interest from August December) AUGUST FOLLOWING THE LEAVE OF ABSENCE YEAR! Cheque for interest January to July (this amount should not appear on T4 issued to the teacher by the Board) JANUARY FOLLOWING THE LEAVE OF ABSENCE YEAR! T4-A for interest January to July Teachers enrolled in a six (6) month leave plan (a) If you take your leave of absence starting in August: The Teachers Plus Credit Union will send the Board 13 post-dated cheques to include:! Amounts Deferred! Accrued Interest to August! Taxable amount of cheque (deferred amount less interest)! Non-taxable amount of cheque (Interest included in cheque) Teachers Guide to the Deferred Salary Leave Plan 7

10 JANUARY DURING LEAVE OF ABSENCE BEGINNING IN AUGUST: T4-A for interest from January to December (January to August on amounts in deferred account; August to December on pay-down amounts) MARCH IMMEDIATELY FOLLOWING LEAVE OF ABSENCE BEGINNING IN AUGUST Cheque for pay-down interest from August until February JANUARY FOLLOWING LEAVE OF ABSENCE PERIOD T4-A for pay-down interest for January and February b) If you take your leave starting in February: JANUARY PRIOR TO LEAVE OF ABSENCE T4-A for interest earned from January to December AT COMMENCEMENT OF LEAVE OF ABSENCE IN FEBRUARY! 13 post-dated cheques! Statement showing total amount in deferred fund including accrued interest! Taxable amount (deferred amount less interest)! Non-taxable amount (interest only) AUGUST FOLLOWING PERIOD OF LEAVE! Cheque for interest from February to August (pay-down interest) JANUARY FOLLOWING LEAVE OF ABSENCE PERIOD! T4-A for interest from January to August (January and February for amounts deferred and pay-down interest from February to August) 8 Teachers Guide to the Deferred Salary Leave Plan

11 10. EXTENSION REQUEST If a teacher wishes to extend the Deferred Salary Leave Plan beyond the time frame originally agreed upon, that teacher must request the extension in writing from the school board. If the extension is granted the teacher must pay a minimum 5% of annual salary to maintain enrolment in the plan. 11. WITHDRAWAL FROM THE PLAN! A teacher may withdraw from the plan any time prior to March 1 st of the calendar year in which the leave is to commence. Any exception shall be at the discretion of the school board.! Teachers may, under exceptional circumstance such as serious illness, death, resignation or early retirement, withdraw from the plan at any time during the year(s) of deferral provided the withdrawal is approved by the Board. Such approval shall not be unreasonably withheld.! If a teacher withdraws, the teacher shall be paid a lump sum adjustment equal to any monies deferred plus accrued interest. Repayment shall be made as soon as possible within sixty (60) days of withdrawal from the plan.! If a teacher withdraws from the plan any time during their period of leave, an administration fee of $ shall be applied by the Teachers Plus Credit Union. 12. FINANCIAL INFORMATION A. CALCULATION OF INTEREST 1. The number of interest calculations in a year will equal the number of pay periods in a year (26). 2. The rate is determined on the last day of each month by taking the average of the Plan 24 savings account at Teachers Plus Credit Union, and a one, three and five year non-redemmable term deposit. The rates for term deposits shall be the average Teachers Guide to the Deferred Salary Leave Plan 9

12 of those quoted by Teachers Plus Credit Union, Royal Bank, Scotia Bank, CIBC, TD Canada Trust, and Bank of Montreal. 3. The interest rate is then applied to the balance in the teacher s account on the day prior to each payday. The balance includes both the salary deferred and the interest earned. Example (Based on 26 pay periods) Sample Rates " Plan 24 Savings Account 0.10% " 1 year term deposit 1.65% " 2 year term deposit 1.85% " 3 year term deposit 3.15% Average: 1.69% Date Transaction Balance Interest Calculation Aug. 14 $500 Dep. $ $ x 1.69% x 14 = $ Aug. 28 $500 Dep. $1, $1, x 1.69% x 13 = $ Sept. 11 $0.92 Int. $1, $ $0.60 = $0.92 One Year Leave Interest will also be earned on the pay-down of deferred amounts during the period of leave. Teachers T4-A slips are sent to the Board by the Teachers Plus Credit Union and in turn forwarded to the teacher. Interest, however, remains in the account with the whole amount divided into 26 pay periods for a one year of leave and 13 pay periods for a six month leave. A statement is sent to the Board when the teacher begins the leave. The Teachers Plus Credit Union give the Board 26 pay periods for a one year of leave and 13 pay periods for six month leave. 10 Teachers Guide to the Deferred Salary Leave Plan

13 A statement is sent to the Board when the teacher begins the leave. The Teachers Plus Credit Union give the Board 26 or 13 post-dated cheques depending on the length of leave requested. For teachers enrolled in a one year leave plan, pay-down interest is paid in January during the year of leave and August immediately following the year of leave. A T4-A will be issued for pay-down interest and interest earned from January to August will be issued in January during your year of leave and January following your year of leave. Six Month Leave Plan Interest remains in the account with the whole amount divided into 13 pay periods for a six month leave. This will include amounts deferred from August until February for those taking their leave from February to August. For teachers enrolled in a six month leave plan, who are taking their leave in August, the pay-down interest for the period from August to February is paid in one cheque on the 1 st of March. For teachers enrolled in a six month leave plan, who are taking their leave in February, the pay-down interest for the period from February to August is paid in one cheque on August 1. For those on a six month leave beginning in August, they will receive a T4-A in January for interest on the pay-down period from August to December and another T4-A in January following the period of leave for pay-down interest for January and February. For those on a six month leave plan beginning in February, they will receive a T4-A in January prior to taking their leave for interest accumulated on amounts deferred from January to December and another T4-A the January following their leave for interest accumulated in January and February and pay-down interest from February to August. Teachers Guide to the Deferred Salary Leave Plan 11

14 INTEREST IS TAXABLE IN THE YEAR IN WHICH IT IS EARNED. B. DEDUCTIONS Assume: Teacher Deferring 20% DEDUCTIONS YEARS OF YEAR DEFERRAL LEAVE EI 100% 0 CPP 80% Deferred Amount TPP 100% 100% Union Dues $ $ Income Tax 80% Deferred Amount C. PAYMENT OF FUNDS FOR WITHDRAWAL Total in Fund: This includes amounts deferred and accrued interest (only the amount deferred is to be taxed by the Board) January following withdrawal, the teacher receives a T4-A for interest from January until the time of withdrawal. D. SALARY PAYMENTS FOR THE LEAVE OF ABSENCE (a) (b) (c) On July 31, the total deferred amount plus accrued interest to the credit of the teacher is divided by the number of pays according to the duration of the plan. This determines the salary for each pay. Interest continues to accumulate on the pay-down and is credited to the teacher s account the day prior to each pay day. Pay-down interest earned for those taking a one year leave shall be paid in two installments: one in January of the year of leave and one in August following the year of leave. 12 Teachers Guide to the Deferred Salary Leave Plan

15 (d) (e) Pay-down interest earned for those taking a six month leave starting in August shall be paid in one cheque on March 1 st. Pay-down interest earned from those taking a six month leave starting in February shall be paid in one cheque on August 1 st. E. FINANCING YEAR The following comparison of net salary for a teacher on full salary versus the various Deferred Salary options for a full year are rough calculations and for illustrative purposes only. Each individual teacher s situation will be different. The salaries are those that will be in effect as of September Taxes deducted vary for each teacher and they are rough approximations. EI and CPP are based on 2009 formulae. (Please note that salary is currently under negotiations.) Full Salary Top of Top of Top of Top of ITC (TC5) ATC1 (TC6) ATC2 (TC7) ATC 3 (TC8) Salary Salary Salary Salary Scale Scale Scale Scale Salary $ 67,186 $74,951 $79,599 $84,010 Estimated Tax 14,669 17,323 19,012 20,311 Estimated EI Estimated CPP 2,119 2,119 2,119 2,119 NSTU Union Dues Pension Deductions 5,934 6,703 7,163 7,600 Estimated Net $43,042 $47,384 $49,883 $52,558 Teachers Guide to the Deferred Salary Leave Plan 13

16 2/3 Deferred Top of Top of Top of Top of ITC (TC5) ATC1 (TC6) ATC2 (TC7) ATC 3 (TC8) Salary Salary Salary Salary Scale Scale Scale Scale Salary $44,791 $49,967 $53,066 $56,007 Estimated Tax 6,549 7,991 9,011 9,900 Estimated EI Estimated CPP 2,119 2,119 2,119 2,119 NSTU Union Dues Pension Deductions 5,934 6,703 7,163 7,600 Estimated Net $28,767 $31,732 $33,351 $34,966 3/4 Deferred Salary Top of Top of Top of Top of ITC (TC5) ATC1 (TC6) ATC2 (TC7) ATC 3 (TC8) Salary Salary Salary Salary Scale Scale Scale Scale Salary $50,390 $56,213 $59,699 $63,008 Estimated Tax 8,428 10,217 11,426 12,442 Estimated EI Estimated CPP 2,119 2,119 2,119 2,119 NSTU Union Dues Pension Deductions 5,934 6,703 7,163 7,600 Estimated Net $32,487 $35,752 $37,569 $39, Teachers Guide to the Deferred Salary Leave Plan

17 4/5 Deferred Salary Top of Top of Top of Top of ITC (TC5) ATC1 (TC6) ATC2 (TC7) ATC 3 (TC8) Salary Salary Salary Salary Scale Scale Scale Scale Salary $53,748 $59,961 $63,679 $67,208 Estimated Tax 9,598 11,656 12,809 13,961 Estimated EI Estimated CPP 2,119 2,119 2,119 2,119 NSTU Union Dues Pension Deductions 5,934 6,703 7,163 7,600 Estimated Net $34,675 $38,061 $40,166 $42,106 5/6 Deferred Salary Top of Top of Top of Top of ITC (TC5) ATC1 (TC6) ATC2 (TC7) ATC 3 (TC8) Salary Salary Salary Salary Scale Scale Scale Scale Salary $55,988 $62,459 $66,333 $70,008 Estimated Tax 10,490 12,579 13,825 15,014 Estimated EI Estimated CPP 2,119 2,119 2,119 2,119 NSTU Union Dues Pension Deductions 5,934 6,703 7,163 7,600 Estimated Net $36,023 $39,636 $41,804 $43,853 Teachers Guide to the Deferred Salary Leave Plan 15

18 F. SIX MONTH DEFERRED SALARY Example: TC5 Maximum Year 1: 10% (09/10) Year 2: 10% (10/11) Year 3: 10% (11/12) Year 4: 10% (12/13) Year 5: 5% (13/14) Enrolment Date: August 1, 2009 Example: Leave of Absence: February 1, 2014 to July 31, 2014 The example does not reflect any salary increase. $67,186: Salary $2,584.08: Bi-weekly Year 1 $2, $ (10%) $2, Teachers Guide to the Deferred Salary Leave Plan

19 Example: Deferred for Leave: $ x 26 = $6, Year 1 $6, Year 2 $6, # = $26, Year 3 $6, Year 4 $6, Example: Year 5:August to January (13 Pays) August, 2013 to January, pays x = $3, Deferred Amounts: $26, $ 3, $30, interest (amount deferred for salary for the six months) EXAMPLE: 6 Month leave in Year 5 $30, = $2, interest Teachers Guide to the Deferred Salary Leave Plan 17

20 13. COMMON QUESTIONS Q. When does my leave of absence commence if I enrol for six (6) month leave of absence. A. There are two possible periods of leave. You can leave August 1 or February 1. However, you must include either July or August in your six (6) month leave of absence period. Q. Am I permitted to retire immediately following a deferred leave of absence? A. No. The plan is not to provide for benefits on retirement. A teacher must return to employment for a period of time equal to the length of the leave. Q. How long do I have to be teaching before I can enrol in the deferred salary plan? A. You must hold a permanent contract and be employed for a five year period. The five years can include employment with Board as a term contract teacher or substitute but must have permanent contract at time of application. Q. I am currently enrolled in a one year deferred salary plan. Can I switch to a 6 month leave plan? A. Yes. You must make application to your Superintendent requesting an amendment to your plan. This must be done at least 6 months prior to the beginning of the school year in which you are scheduled to take your leave of absence. Q. Am I an active member of the Nova Scotia Teachers Union while I am on leave of absence. A. Yes, as you pay full dues during your leave of absence. Q. Do I have to study during the leave of absence period? A. No you can study, travel, work, sing, fish or just sit and watch the time go by. Q. Do I have to tell the Board what I intend to do? A. No, but it probably would be wise to do so. Consider the following. There are two teachers in the science department, both apply for leave, one gives the reason, one doesn t. Both applications can t be accepted 18 Teachers Guide to the Deferred Salary Leave Plan

21 as it would wipe out the department. Whose application is likely to be approved, the one who gave the reasons or the one who didn t? Q. Can the Board reject the plan? A. No, the plan is provincial and in the Teachers Provincial Agreement. The Board must consider each application and act upon it. The Board can accept or reject an application but not the plan. Q. Is the leave of absence period pensionable time? A. Yes, the period of leave will count as pensionable time. Q. In the leave of absence period, is the interest paid out as salary or as interest earned? A. The interest comes to you as salary received and not as interest earned. Q. Do I receive interest on the depreciating balance for the leave of absence period? A. Yes, it is calculated in exactly the same manner as in the years of deferral. Q. Is there a minimum amount which can be deferred? A. Yes, the percentage of annual salary deferred in any one (1) year shall not be less than 5%. Q. Is there a maximum amount which can be deferred. A. Yes, 33 1/3% of salary in any year. Q. What is the difference between salary earned and salary received? A. The salary earned is 100% of salary before deferral takes place. The salary received is the reduced amount after deferral. Q. Do I have income tax and other deductions taken from 100% of salary or the reduced amount during the period of deferred leave? A. During the period of deferral, Income Tax and Canada Pension Plan contributions are paid on the reduced salary. Salary Continuation and Teachers Pension Plan contributions are based on 100% of salary. Teachers Guide to the Deferred Salary Leave Plan 19

22 During the leave of absence period, Income Tax is paid on the deferred amount received less interest. Canada Pension Plan contributions are based on the salary received and Salary Continuation and Teachers Pension Plan contributions are based on 100% salary. Q. What about Employment Insurance deductions? A. During the period of deferral, deductions are based on 100% of salary. However, no deductions are made during the actual leave of absence. Therefore, the leave of absence is not counted towards insured employment for EI purposes. Q. Are teachers on deferred salary leave eligible for EI benefits under the maternity sub-plan? A. The Canada Revenue Agency does not recognize the year of deferred leave as a leave of insurable earnings for Employment Insurance benefits. Therefore, a teacher would not be eligible for maternity leave sub plan benefits the year immediately following the year of leave until the teacher has worked 600 insurable hours in the previous 52 weeks. By agreement with the NSTU, each school board reports that teachers work an eight (8) hour day for EI purposes. Employment Insurance Regulations do not allow a teacher under contract to collect EI benefits excepting maternity, parental and sick leave benefits. However, it does allow a teacher on the year of deferred leave to open a claim during a non teaching period. Once a claim is opened it remains open for a fifty-two (52) week period. Female teachers in the year of the leave of absence may wish to open a claim during the Christmas break of that year. This would allow female teachers to be eligible for EI benefits and Maternity Sub Plan benefits during the August 1 to December 31 period of the year returning from the leave of absence. It is important to note that a teacher s eligibility for EI benefits and the Maternity Sub Plan would expire on December 31 of that year and eligibility would not be restored until the teacher has 20 Teachers Guide to the Deferred Salary Leave Plan

23 worked 600 insurable hours in the year following the leave of absence. Teachers who, in a leave of absence, work for another employer would accumulate insurable hours and provided they have worked 600 insurable hours would be eligible for EI benefits and Maternity Sub Plan benefits in the year returning from the leave of absence. Teachers on a six (6) month leave of absence should contact their local EI office to determine eligibility. Q. What happens if I am going on maternity and parental leave and I am enrolled in a deferred salary leave plan? A. Teachers are required to contribute at least 5% in each year of the plan prior to the year of leave. Therefore, a teacher on maternity and parental leave may need to amend the agreement to make sure the teacher contributes at least 5% during the regular salary period or from the maternity top up in any one school year. Mutual agreement between the teacher and School Board is required in order to amend the Agreement. Please note the members for the Community College may suspend for one year and not make contributions. Q. Can I remain in the plan if I take a full year leave of absence when I am required to be deferring salary into the plan? A. No, if you are a Public School teacher or APSEA teacher you must withdraw from the plan because you are unable to make the minimum 5% contribution. Revenue Canada allows a person to suspend contributions for one year but the contract does not permit it. The Community College contract does allow a member to suspend for one year so it is not necessary to withdraw from the plan. Q. May I arrange to have premium costs for insurance benefits deducted from my cheque during my period of leave? A. Yes, provided you give the Board at least sixty (60) days notice prior to commencement of the leave. Teachers Guide to the Deferred Salary Leave Plan 21

24 Q. May I withdraw from the plan? A. A teacher may withdraw from the plan at any time prior to March 1 st of the calendar year in which the leave is to commence. Community College members may withdraw for extenuating circumstances and approval of College at least 4 months prior to leave. Teachers may, under exceptional circumstances such as serious illness, death, resignation, or early retirement, withdraw from the plan at any time during the year(s) of deferral provided the withdrawal is approved by the school board. Such approval shall not be unreasonably withheld. 22 Teachers Guide to the Deferred Salary Leave Plan

25 REFERENCES A - Provincial Agreement Reference, Article 39 Article 39 - Deferred Salary Leave Plan A Deferred Salary Leave Plan as agreed by the Employer and the Union, Appendix B, shall be implemented The Employer shall be responsible for advising School Boards of the details of the program The Union shall be responsible for advising the teachers of the details of the program The program shall not be amended except by mutual agreement of the Employer and the Union. B - Provincial Agreement Appendix B Purpose.01 The Deferred Salary Leave Plan will afford teachers the opportunity of taking a one (1) year or the equivalent of a six (6) month leave of absence, and through deferral of salary, finance the leave. Eligibility.02 Any teacher who holds a permanent contract with a School Board is eligible to participate in the Plan. Application.03 A teacher must make written application to the Superintendent of Schools/Director of Education on or before April 30 th of the school year prior to the school year deferment is to commence, requesting permission to participate in the Plan..04 Written acceptance, or denial, of the teacher s request, with explanation, shall be forwarded to the teacher by June 15 th in the school year the original request is made..05 Approval of individual requests to participate in the Plan shall rest solely with the School Board and a refusal by the School Board to approve an application shall be final and non-grievable. Teachers Guide to the Deferred Salary Leave Plan 23

26 Payment Formula and Leave of Absence.06 The payment of salary, benefits, and the timing of the one (1) year or six (6) month leave of absence shall be as follows: (i) In each year of the Plan, preceding the year of the leave, a teacher will be paid a reduced percentage of the teacher s applicable annual salary. The remaining percentage of annual salary shall be deferred and this accumulated amount plus interest earned shall be retained for the teacher by the School Board to finance the leave. (ii) The percentage of annual salary deferred in any one (1) year shall not be less than five percent (5%). (iii) The calculation of interest under terms of this Plan shall be done daily an dpaid monthly (not in advance). The rate is determined on the last day of each month by taking the average of the Plan 24 savings account at the Teachers Plus Credit Union, and a one, three and five year non-redeemable term deposit. The rates for term deposits shall be the average of those quoted by Teachers Plus Credit Union, Royal Bank, Scotia Bank, CIBC, TD Canada Trust, and Bank of Montreal. Interest shall be calculated as above and credited to the teacher s account on the day prior to each of the regular pay dates of the teacher. Benefits.07 While a teacher is enrolled in the Plan, and not on leave, any benefits tied to salary level shall be structured according to the salary the teacher would have received had the teacher not been enrolled in the Plan..08 A teacher s benefits will be maintained during the leave of absence; however, the premium costs of all benefits shall be paid by the teacher during the year of the leave..09 (i) While on leave, any benefits tied to salary level shall be structured according to the salary the teacher would have received in the year prior to taking the leave had the teacher not been enrolled in the plan. 24 Teachers Guide to the Deferred Salary Leave Plan

27 (ii) While on a leave of six (6) months within a school year, any benefits tied to salary level shall be structured according to the salary the teacher would have received during the current school year..10 Sick leave credits shall not accumulate and cannot be used during the leave..11 Pension deductions shall be continued during the leave. The leave shall count as pensionable and teaching service..12 Pension deductions shall be made on the salary the teacher would have received had the teacher not entered the plan or gone on leave..13 On return from leave, a teacher shall be assigned, unless there is mutual agreement, to the same position, supervisory position, or, if due to declining or changing enrolment patterns, said position no longer exists, the employee shall be governed by the appropriate terms of the agreement. Withdrawal from the Plan.14 A teacher may withdraw from the Plan any time prior to March 1 st of the calendar year in which the leave is to commence. Any exceptions to the aforesaid shall be at the discretion of the School Board. Repayment shall be pursuant to Notwithstanding.14 teachers who enter the Plan on or after August 1, 1990 may under exceptional circumstances such as serious illness, death, resignation or early retirement withdraw from the Plan at any time during the year(s) of deferral provided the withdrawal is approved by the School Board. Such approval shall not be unreasonably withheld. Repayment shall be pursuant to If a teacher withdraws, the teacher shall be paid a lump sum adjustment equal to any monies deferred plus interest accrued. Repayment shall be made as soon as possible within sixty (60) days of withdrawal from the Plan..17 Should a teacher die while participating in the Plan any monies accumulated, plus interest accrued at the time of death, shall be paid to the teacher s estate. Teachers Guide to the Deferred Salary Leave Plan 25

28 .18 Teachers who are discharged pursuant to Article and teachers who are terminated pursuant to Article (ii) or in accordance with the provisions of an Agreement between a School Board and the Union while enrolled in the Plan shall be required to withdraw and shall be paid a lump sum adjustment of salary deferred to the date of withdrawal, plus interest accrued. Repayment shall be made as soon as possible within sixty (60) days of withdrawal from the Plan. Contract.19 All teachers wishing to participate in the Plan shall be required to sign the approved contract before final approval for participation is granted..20 Once entered into, the contract provisions concerning percentage of salary and year of leave may be amended by mutual agreement between the teacher and the School Board. C. Community College Agreement - Faculty Article 43: Deferred Salary Leave Plan 43.1 A Deferred Salary Leave Plan acceptable to the College and the Union shall be implemented in accordance with the provisions outlined in clauses 43.3 through The Plan shall not be amended except by agreement of the College and the Union. Purpose 43.3 The purpose of the Deferred Salary Leave Plan is to afford Faculty Members the opportunity to take a leave of absence (Leave) and, through deferral of salary, finance the Leave. Eligibility 43.4 Participation in this Plan is limited to regular full- or part-time Faculty Members. Application 43.5 The application to participate in this Plan shall be submitted to the College not later than four (4) months prior to the month in which the salary deferment is to commence. 26 Teachers Guide to the Deferred Salary Leave Plan

29 Approval 43.6 (a) Approval to participate in this Plan is at the discretion of the College, and refusal by the College to approve the request shall be non-grievable. (b) (c) The College shall inform the Faculty Member of its decision not later than three (3) months prior to the month in which the requested salary deferment would commence. Where the request has been denied, the College shall provide reasons in writing. On each occasion where an application to participate in the Plan is approved, the Union shall be notified. Conditions 43.7 The payment of salary shall be as follows: (a) In each year of the Plan preceding the leave [up to a maximum of six 6) years], a Faculty Member shall be paid a reduced percentage of the applicable bi-weekly salary in accordance with a contract between the Faculty Member and the College. The remaining percentage of biweekly salary, in accordance with the contract, shall be deferred. This accumulated amount plus interest earned shall be retained for the Faculty Member by the College to finance the Leave. (b) The percentage of salary deferred on a bi-weekly basis in any one (1) year shall not be less than five percent (5%) and not greater than thirty-three and one third percent (33 1/3%). (c) The calculation of interest under terms of this Plan shall be done monthly (not in advance). The interest paid shall be calculated by averaging the interest rates in effect on the last day of each month for a true savings account, a one (1) year term deposit, a three (3) year term deposit and a five (5) year term deposit. The rates for each of the accounts identified shall be those quoted by the main branch in Nova Scotia of the bank with which the College deals. Interest shall be calculated as above and credited to the Faculty Member s account on the day prior to each of the regular pay dates of the Faculty Member. Teachers Guide to the Deferred Salary Leave Plan 27

30 (d) (e) During the Leave, a Faculty Member cannot receive any additional remuneration from the College. Notwithstanding 43.7 (b), the College may approve a suspension from the plan in accordance with federal guidelines for a period of twelve (12) months from the anniversary date of enrolment in the plan. Benefits 43.8 While a Faculty Member is enrolled in the Plan, and not on Leave, any benefits tied to salary shall be structured according to the salary the Faculty Member would have received had the Faculty Member not been enrolled in the Plan. All other benefits shall be in accordance with the Collective Agreement Unless otherwise instructed in writing by the Faculty Member, the health and welfare benefits of the Faculty Member shall be maintained during the Leave; however, the full premium costs of all benefits shall be paid by the Faculty Member during the Leave from the monies retained for the Faculty Member by the College to finance the Leave, save those required to be paid by the College by law While the Faculty Member is on Leave, any benefits tied to salary level shall be structured according to the salary the Faculty Member would have received in the equivalent period prior to taking the Leave had the Faculty Member not been enrolled in the Plan During the Leave, the Faculty Member shall not accumulate nor be entitled to the following: (a) vacation; statutory holidays; pregnancy, parental, and adoption leaves; sick leave, or other leaves; (b) credit for service for severance pay for the period of the Leave Pension deductions shall be continued during the Leave in accordance with the appropriate pension act. The Leave shall count as pensionable service in accordance with the appropriate pension act and for seniority purposes Pension deductions shall be made according to the salary the Faculty Member would have received had the Faculty Member not entered the Plan or gone on Leave. 28 Teachers Guide to the Deferred Salary Leave Plan

31 Return to Regular Assignment (a) Canada Customs and Revenue Agency Regulations require a Faculty Member to return to the College upon completion of the Leave for a period that is not less than the duration of the Leave. (b) Upon completion of the Leave, the Faculty Member shall be reinstated to the continuing full-time or recurring full- or part-time position held immediately prior to the Leave or to a comparable position at the same campus. If the position held by the Faculty Member immediately prior to the Leave no longer exists, the Faculty Member shall be subject to the provisions of Article 27: Position Reductions, Layoff, and Reinstatement. Withdrawal from the Plan A Faculty Member who ceases to be employed by the College or is laid off in accordance with Article 27: Position Reductions, Layoff, and Reinstatement shall withdraw from the Plan. Repayment shall be pursuant to In extenuating circumstances such as financial hardship or serious illness and with the approval of the College, a Faculty Member may withdraw from the Plan not later than four (4) months prior to the date established for the Leave. Such approval shall not be unreasonably withheld. Repayment shall be pursuant to If a Faculty Member withdraws from the Plan, the Faculty Member shall be paid a lump sum adjustment equal to any monies deferred plus interest accrued. Repayment shall be made as soon as possible within sixty (60) days of withdrawal from the Plan Should a Faculty Member die while participating in the Plan, any monies accumulated plus interest accrued at the time of death shall be paid to the beneficiary specified in the life insurance policy of health and welfare benefits or to the Faculty Member s estate. Teachers Guide to the Deferred Salary Leave Plan 29

32 Amendment Once approved, the provisions concerning percentage of salary deferred and the Leave may be amended by agreement between the Faculty Member and the College Where a Faculty Member requests amendment to the terms of the Faculty Member s Deferred Salary Leave Plan, the College shall respond to the Faculty Member within sixty (60) days. Scheduling of Leave and Vacation One (1) Year Leave A one (1) year Leave under this Plan shall commence on the fifteenth (15th) day of August and end on the fourteenth (14th) day of August in the year following. Six (6) Month Leave A six (6) month Leave approved under this Plan shall commence on the first (1st) day of February and end on the thirty-first (31st) day of July of the same year. Vacation earned prior to the commencement of the Leave shall be scheduled during the month of January prior to commencing the Leave. Vacation earned during the period commencing on the first (1st) day of August and ending on the fourteenth (14th) day of August after returning from Leave shall be scheduled in conjunction with the holiday specified in clause 33.1 (k) Where operational conditions permit, the College may also approve a six (6) month Leave to commence on the first (1st) day of July and end on the thirtyfirst (31st) day of December of the same year. Vacation earned prior to the commencement of the Leave shall be scheduled during the period between the first (1st) day of May and thirtieth (30th) day of June prior to the commencement of the Leave. Vacation earned during the period commencing on the first day of January and ending on the fourteenth (14th) day of August after returning from the Leave shall be scheduled during the period commencing on the first (1st) day of July and ending on the fourteenth (14th) day of August, normally commencing the first working day in July. 30 Teachers Guide to the Deferred Salary Leave Plan

33 D. Community College Agreement - Professional Support Article 42: Deferred Salary Leave Plan 42.1 A Deferred Salary Leave Plan acceptable to the College and the Union shall be implemented in accordance with the provisions outlined in clauses 42.3 through The Plan shall not be amended except by agreement of the College and the Union The purpose of the Deferred Salary Leave Plan is to afford Employees the opportunity to take a six (6) month or one (1) year leave of absence (Leave) and, through deferral of salary, finance the Leave. Eligibility 42.4 Participation in this Plan is limited to regular full- or part-time Employees. Application 42.5 The application to participate in this Plan shall be submitted to the College not later than four (4) months prior to the month in which the salary deferment is to commence. Approval 42.6 (a) Approval to participate in this Plan is at the discretion of the College, and refusal by the College to approve the request shall be non-grievable. (b) (c) The College shall inform the Employee of its decision not later than three (3) months prior to the month in which the requested salary deferment would commence. Where the request has been denied, the College shall provide reasons in writing. On each occasion where an application to participate in the Plan is approved, the Union shall be notified. Conditions 42.7 The payment of salary shall be as follows: Teachers Guide to the Deferred Salary Leave Plan 31

34 (a) (b) (c) (d) (e) In each year of the Plan preceding the leave [up to a maximum of six (6) years], an Employee shall be paid a reduced percentage of the applicable bi-weekly salary in accordance with a contract between the Employee and the College. The remaining percentage of bi-weekly salary, in accordance with the contract, shall be deferred. This accumulated amount plus interest earned shall be retained for the Employee by the College to finance the Leave. The percentage of salary deferred on a bi-weekly basis in any one (1) year shall not be less than five percent (5%) and not greater than thirty-three and one third percent (33 1/3%). The calculation of interest under terms of this Plan shall be done monthly (not in advance). The interest paid shall be calculated by averaging the interest rates in effect on the last day of each month for a true savings account, a one (1) year term deposit, a three (3) year term deposit and a five (5) year term deposit. The rates for each of the accounts identified shall be those quoted by the main branch in Nova Scotia of the bank with which the College deals. Interest shall be calculated as above and credited to the Employee s account on the day prior to each of the regular pay dates of the Employee. During the Leave, an Employee cannot receive any additional remuneration from the College. Notwithstanding 42.7 (b), the College may approve a suspension from the plan in accordance with federal guidelines for a period of twelve (12) months from the anniversary date of enrolment in the plan. Benefits 42.8 While an Employee is enrolled in the Plan, and not on Leave, any benefits tied to salary shall be structured according to the salary the Employee would have received had the Employee not been enrolled in the Plan. All other benefits shall be in accordance with the Collective Agreement. 32 Teachers Guide to the Deferred Salary Leave Plan

35 42.9 Unless otherwise instructed in writing by the Employee, the health and welfare benefits of the Employee shall be maintained during the Leave; however, the full premium costs of all benefits shall be paid by the Employee during the Leave from the monies retained for the Employee by the College to finance the Leave, save those required to be paid by the College by law While the Employee is on Leave, any benefits tied to salary level shall be structured according to the salary the Employee would have received in the equivalent period prior to taking the Leave had the Employee not been enrolled in the Plan During the Leave, the Employee shall not accumulate nor be entitled to the following: (a) (b) vacation; statutory holidays; pregnancy, parental, and adoption leaves; sick leave, or other leaves; credit for service for severance pay for the period of the Leave Pension deductions shall be continued during the Leave in accordance with the appropriate pension act. The Leave shall count as pensionable service in accordance with the appropriate pension act and for seniority purposes Pension deductions shall be made according to the salary the Employee would have received had the Employee not entered the Plan or gone on Leave. Return to Regular Assignment (a) Canada Customs and Revenue Agency Regulations require an Employee to return to the College upon completion of the Leave for a period that is not less than the duration of the Leave. (b) Upon completion of the Leave, the Employee shall be reinstated to the continuing full-time or recurring full- or part-time position held immediately prior to the Leave or to a comparable position at the same campus. If the Teachers Guide to the Deferred Salary Leave Plan 33

36 position held by the Employee immediately prior to the Leave no longer exists, the Employee shall be subject to the provisions of Article 26: Position Reductions, Layoff, and Reinstatement. Withdrawal from the Plan An Employee who ceases to be employed by the College or is laid off in accordance with Article 26: Position Reductions, Lay-off, and Reinstatement shall withdraw from the Plan. Repayment shall be pursuant to In extenuating circumstances such as financial hardship or serious illness and with the approval of the College, an Employee may withdraw from the Plan not later than four (4) months prior to the date established for the Leave. Such approval shall not be unreasonably withheld. Repayment shall be pursuant to If an Employee withdraws from the Plan, the Employee shall be paid a lump sum adjustment equal to any monies deferred plus interest accrued. Repayment shall be made as soon as possible within sixty (60) days of withdrawal from the Plan Should an Employee die while participating in the Plan, any monies accumulated plus interest accrued at the time of death shall be paid to the beneficiary specified in the life insurance policy of health and welfare benefits or to the Employee s estate. Amendment Once approved, the provisions concerning percentage of salary deferred and the Leave may be amended by agreement between the Employee and the College Where an Employee requests amendment to the terms of the Employee s Deferred Salary Leave Plan, the College shall respond to the Employee within sixty (60) days. 34 Teachers Guide to the Deferred Salary Leave Plan

37 Further information may be obtained by contacting: Member Services Department Nova Scotia Teachers Union 3106 Joseph Howe Drive Halifax, NS B3L 4L Teachers Guide to the Deferred Salary Leave Plan 35

38 36 Teachers Guide to the Deferred Salary Leave Plan

39 NOVA SCOTIA TEACHERS UNION 3106 Joseph Howe Drive Halifax, Nova Scotia B3L 4L7 Comments on this document are welcomed. Toll free: Revised April 2009