Infrmatin abut the Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals
Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals Disclaimer: This bklet is fr infrmatin purpses nly. N rights are cnferred by this bklet. Fr authritative wrding regarding this pensin plan, please refer t the Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals plan text As there may be revisins t this bklet frm time t time, members shuld access the nline versin f this bklet available at http://www.vestcr.rg/cupe1252 t ensure that they have the current versin f the bklet. Prepared by: Vestcr Pensin Services Crpratin www.vestcr.rg/pensins Internet versin revised May 2017 ISBN: 978-1-55471-615-9 Printed in New Brunswick Think Recycling!
TABLE OF CONTENTS Intrductin... 1 Wh shuld read this bklet?... 1 What determines my participatin in the Plan?... What type f pensin plan is the CUPE Hspitals Shared Risk Plan?...... 1 2 What legislatin gverns this pensin plan?... 2 Hw is my pensin plan managed?... 3 Being a Pensin Plan Member. 4 When can I jin the pensin plan?... 4 Hw much d I cntribute t the pensin plan?... 4 Hw much des my emplyer cntribute t the pensin plan?... 4 What happens t the funds cntributed?... 5 D I need t designate a beneficiary?... 5 What is the definitin f Spuse and Cmmn-Law Partner?... 5 Retirement under the Plan. 6 Hw is my lifetime pensin calculated?... 6 What is the bridge benefit?... 6 What is the relatinship between the CUPE Hspitals Shared Risk Plan and the Canada Pensin Plan (CPP)?... Are my pensin benefits adjusted fr cst f living increases (COLA)?... 7 7 Hw lng d I have t wrk befre I m entitled t receive a mnthly pensin benefit upn retirement?... 8 At what age can I retire?... 8 What will I receive at the time f retirement?... 9 Are there different frms f pensin that I can chse frm?... 9 Must I apply fr my pensin?... 11 When will the payment f my pensin ccur?... 11 Leaving the plan befre retirement 12 What happens if I terminate emplyment befre retirement?... 12
TABLE OF CONTENTS (CONTINUED) Benefits upn death f a Member... 14 What benefits are payable upn my death?... 14 Purchasing Prir Service... 15 Can I purchase perids f pensinable service?... 15 What methd f payment can I use t pay fr my purchase f service?... 16 Pensin Plan Prvisins in Other Circumstances..... 17 Can I transfer between pensin plans?... 17 What happens if my marriage/cmmn-law partnership ends?... 17 Other Infrmatin. 18 Where can I get mre infrmatin?... 18 Checklist Appraching Retirement.. 19 Summary f Key Prvisins.... 20 Glssary.. 22
Intrductin Wh shuld read this bklet? Even if retirement seems a lng way ff, there are sme things yu shuld knw abut yur pensin plan, the Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals (the CUPE Hspitals Shared Risk Plan ). This bklet will prvide yu with a general verview f the plan s main features and will be helpful t anyne wh: is a cntributr t the CUPE Hspitals Shared Risk Plan; and wuld like t gain an understanding f the plan prvisins in rder t plan fr their retirement. The infrmatin in this bklet is based n the rules and criteria which currently exist under the CUPE Hspitals Shared Risk Plan. The CUPE Hspitals Shared Risk Plan is subject t amendment frm time t time in accrdance with its terms. In the event f a discrepancy between the infrmatin prvided in this dcument and the legislatin and/r legal dcuments, the legislatin and/r legal dcuments shall apply. Please nte that all terms that are italicized and underlined in this bklet are defined in the Glssary Sectin at the end f this bklet. What determines my participatin in the Plan? Effective July 1, 2012, participatin in the CUPE Hspitals Shared Risk Plan is mandatry if yu are a permanent, full-time r part-time (as defined in the applicable cllective agreement) emplyee under the age f 65 and are: a member f the Institutinal Services, Part III Bargaining Unit; r a member f the Patient Services Bargaining Unit; r a member f the Clerical, Stengraphic, and Office Equipment Operatin Bargaining Unit; r a member wh ccupies an excluded psitin with Ambulance New Brunswick Inc., FacilicrpNB Ltd., New Brunswick Health Cuncil, Hrizn Health Netwrk r Vitalité Health Netwrk and whse psitin classificatin is included in the Cllective Agreement. Effective July 1, 2014, participatin in the CUPE Hspitals Shared Risk Plan is mandatry if yu are nt a permanent, full-time r part-time (as defined in the applicable cllective agreement) emplyee but yu are under the age f 65, yu are a member f ne f the grups listed abve, and yu meet the fllwing eligibility requirements: have at least 24 mnths f cntinuus emplyment; and have earned at least 35% f the YMPE* in the previus tw calendar years *YMPE - Year s Maximum Pensinable Earnings Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 1
Intrductin (cntinued) What type f pensin plan is the CUPE Hspitals Shared Risk Plan? The Pensin Plan fr CUPE Emplyees f New Brunswick Hspitals (the CUPE Hspitals Pensin Plan ) was cnverted and replaced by the CUPE Hspitals Shared Risk Plan effective July 1 st, 2012. The CUPE Hspitals Shared Risk Plan is a shared risk pensin plan in accrdance with New Brunswick s Pensin Benefits Act. It prvides an Enhanced Career Average benefit. The purpse f the plan is t prvide secure pensin benefits t plan members after their retirement and until their death in respect f their service as plan members. The CUPE Hspitals Shared Risk Plan des nt prvide an abslute guarantee t plan members that Base Benefits and Ancillary Benefits will never be reduced; hwever, because f the risk fcused management apprach there is a high degree f certainty that Base Benefits can be met in the vast majrity f ptential future ecnmic scenaris. All future Cst f Living Adjustments (COLA) and ther Ancillary Benefits under the CUPE Hspitals Shared Risk Plan shall be prvided nly t the extent that funds are available fr such benefits as determined by the Bard f Trustees in accrdance with applicable laws, the CUPE Hspitals Shared Risk Plan text and the plan s Funding Plicy. The main features f the CUPE Hspitals Shared Risk Plan are: Heavily fcused n security f Base Benefits; Rbust risk management; Clear funding guidelines; Sund investment plicy; Clear disclsure t members; and Future cst f living increases are cnditinal n the plan s funded status (Cnditinal Indexing). Please nte that Base Benefits and Ancillary Benefits may be reduced in accrdance with the Funding Plicy. What legislatin gverns this pensin plan? The CUPE Hspitals Shared Risk Plan is subject t and administered in accrdance with bth the Federal Incme Tax Act and Regulatins (the ITA ) and the New Brunswick Pensin Benefits Act and Regulatins (the PBA ). Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 2
Intrductin (cntinued) Hw is my pensin plan managed? A Bard f Trustees is the Administratr f the CUPE Hspitals Shared Risk Plan. The Bard f Trustees cnsists f 8 members: 4 Trustees appinted by the Unin 4 Trustees appinted by the Secretary f the Bard f Management f the Prvince. The Bard f Trustees is respnsible fr administering the CUPE Hspitals Shared Risk Plan in accrdance with the ITA, the PBA, the CUPE Hspitals Shared Risk Plan text and the Funding Plicy (including the pwer t increase r decrease cntributins and/r benefits accrding t the Funding Plicy). The day-t-day administratin f the CUPE Hspitals Shared Risk Plan is cnducted by the Vestcr Pensin Services Crpratin. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 3
Being a Pensin Plan Member When can I jin the pensin plan? Anyne wh satisfies the eligibility requirements described under the sectin What determines my participatin in the Plan? must cntribute t the plan beginning n the first day f the mnth cincident with r next fllwing the emplyee s date f eligibility. Emplyees required t jin the plan must cmplete the prescribed enrllment frm called Applicatin fr Membership which establishes the plan membership date and names yur beneficiary (beneficiaries). The frm must be cmpleted with a representative f yur Human Resurces area. Hw much d I cntribute t the pensin plan? Yur regular cntributins t the CUPE Hspitals Shared Risk Plan are based n a percentage f yur pensinable earnings and are made thrugh payrll deductin. As an active member f the CUPE Hspitals Shared Risk Plan, yu currently cntribute t the plan at a rate f 9.0% f pensinable earnings. This cntributin rate may be increased r decreased in the future by the Bard f Trustees in accrdance with the Funding Plicy. Yu will be ntified f any such cntributin increase r decrease. Yur pay stub infrmatin will shw the deductin fr yur cntributins t the plan every pay perid. Fr the purpse f the pensin plan, pensinable earnings mean the fllwing: fr a full-time member, pensinable earnings is the annual rate f salary befre deductins and exclusive f vertime r ther fluctuating payments. fr a part-time member, pensinable earnings is nrmally grss earnings, received in a given year, excluding vertime r ther fluctuating payments, up t full-time equivalent earnings. Yur annual cntributins are calculated as fllws: Prtin f earnings On all pensinable earnings Member Cntributin Rate (effective July 1, 2012) Example f $30,000 Earnings 9.0% Earnings: $30,000 Rate: X 0.090 Cntributin: $2,700 Hw much des my emplyer cntribute t the pensin plan? Yur emplyer cntributes an amunt equal t 10.1% f the member s pensinable earnings. If the member cntributin rate is increased r decreased by the Bard f Trustees in accrdance with the Funding Plicy, the emplyer cntributins will be similarly adjusted. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 4
Being a Pensin Plan Member (cntinued) What happens t the funds cntributed? Cntributins are depsited int a pensin trust fund. Prfessinal investment managers invest the mney in rder t add additinal revenue t the pensin trust fund. D I need t designate a beneficiary? Subject t the prvisins f any applicable laws r regulatins in effect, a member may designate a beneficiary r beneficiaries t receive any benefit which may be payable under the terms f the CUPE Hspitals Shared Risk Plan upn the death f the member. Designatin f a beneficiary is nrmally dne upn cmmencement f participatin in the CUPE Hspitals Shared Risk Plan by cmpleting the Applicatin fr Membership frm. As well, changes t the beneficiary r beneficiaries can be dne by cmpleting the Designatin/Change f Beneficiary frm. These frms are available thrugh yur Human Resurces r Payrll Office. The nline versins f these frms are available at: http://www.vestcr.rg/cupe1252. If, n the death f the member, there is n designated beneficiary r the designated beneficiary has predeceased the member, any death benefits will be payable t the member s estate. If a member designates a persn ther than his/her Spuse as a beneficiary, the entitlement f the Spuse shall supersede the entitlement f the beneficiary t a death benefit. The Spuse can, hwever, unilaterally waive his/her entitlement t a pre-retirement death benefit by cmpleting a Frm 9 - Pre- Retirement Death Benefit Waiver. The Frm 9 waiver can als be later revked by cmpleting a Frm 10 Revcatin f Pre-Retirement Death Benefit Waiver ; hwever, this Frm 10 wuld need t be cmpleted by bth the member and the Spuse. These frms, if applicable, must be filed with the Vestcr Pensin Services Crpratin (VPSC) prir t the member s death and are available nline at: http://www.vestcr.rg/cupe1252. Cntact VPSC fr further infrmatin. What is the definitin f Spuse and Cmmn-Law Partner? The definitins f Spuse and Cmmn-Law Partner are based n the PBA (See Glssary sectin fr the definitins). If a Spuse and a Cmmn-Law Partner bth claim a right r a benefit under the plan, the Spuse is entitled t the right r benefit, if he r she is therwise eligible, unless there is a valid dmestic cntract between the member r the frmer member and the Spuse, r a decree, rder r judgment f a cmpetent tribunal, barring the Spuse s claim. Nte: The use f the term Spuse in this bklet shall include Cmmn-Law Partner. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 5
Retirement under the Plan Hw is my lifetime pensin calculated? Yur annual lifetime pensin, befre any adjustments fr early retirement r pstpned retirement, is the sum f the fllwing: Service perid Fr each year (r part year) f pensinable service n r after July 1, 2012: Fr all pensinable service between January 1, 1997 and June 30, 2012: Fr all pensinable service prir t January 1, 1997: Fr all pensinable service: Annual Lifetime Pensin frmula 1.4% X Annualized Pensinable Earnings accrued during the year up t the YMPE fr the year PLUS 2% X Annualized Pensinable Earnings accrued during the year in excess f the YMPE fr the year MULTIPLIED BY Number f hurs wrked (and cntributed) / 1,950 hurs Pensinable service X 1.4% X Best 5 year average earnings at June 30, 2012 up t the average YMPE PLUS Pensinable service X 2% X Best 5 year average earnings at June 30, 2012 in excess f the average YMPE Pensinable service X 1.75% X Best 5 year average earnings at June 30, 2012 up t the average YMPE PLUS Pensinable Services X 2% X Best 5 year average earnings at June 30, 2012 in excess f the average YMPE Any Cst f Living Adjustments granted frm time t time by the Bard f Trustees in accrdance with the Funding Plicy YMPE = Year s Maximum Pensinable Earnings used t calculate the Canada Pensin Plan (CPP) cntributins YMPE fr 2017 = $55,300; Average YMPE = 5 year average YMPE (2012 = $47,360) What is the bridge benefit? If yu are eligible fr early retirement, a bridge benefit is paid in additin t yur lifetime pensin. The mnthly Bridge Benefit is equal t $18 multiplied by the number f years f pensinable service up t the Cnversin Date plus $18 multiplied by the number f years the member was a cntributr t the CUPE Hspitals Shared Risk Plan n and after the Cnversin Date (nt pr-rated). It ceases t be paid when yu reach age 65 r upn yur death, whichever is earlier. The bridge benefit is als subject t any Cst f Living Adjustments granted by the Bard f Trustees. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 6
Retirement under the Plan (cntinued) What is the relatinship between the CUPE Hspitals Shared Risk Plan and the Canada Pensin Plan (CPP)? In additin t the pensin cntributins that yu make t the CUPE Hspitals Shared Risk Plan, yu als make cntributins each year t the Canada Pensin Plan (up t the Year s Maximum Pensinable Earnings). Yur CUPE Hspitals Shared Risk Plan pensin benefits cnsist f: The lifetime pensin, which is payable frm the date that yu retire fr yur lifetime; and If yu retire early (prir t age 65), the bridge benefit, which is payable frm yur early retirement date up t age 65 (r yur death, whichever ccurs earlier). The bridge benefit is intended t supplement yur retirement incme until age 65, at which time it wuld cease and yu wuld be eligible fr an unreduced pensin frm the Canada Pensin Plan. It is imprtant t understand, hwever, that the bridge benefit and the unreduced Canada Pensin Plan benefit are nt the same amunt. It is als imprtant t nte that yur pensin payments frm the Canada Pensin Plan d nt need t start at the same time as yur CUPE Hspitals Shared Risk Plan pensin. Whether yu take a reduced pensin frm the Canada Pensin Plan as early as age 60, r an increased pensin frm the Canada Pensin Plan as late as age 70, the bridge benefit frm the CUPE Hspitals Shared Risk Plan is payable upn retirement until age 65 (r yur death, whichever ccurs earlier). Are my pensin benefits adjusted fr cst f living increases (COLA)? Fr active cntributrs t the CUPE Hspitals Shared Risk Plan, the lifetime pensin and bridge benefit that yu earn each year, including benefits earned up t June 30, 2012, may be adjusted by a COLA (n January 1 st ) if the funded status f the CUPE Hspitals Shared Risk Plan allws fr it (Cnditinal Indexing). Once yu retire, yur lifetime pensin and bridge benefit (if any) may als be adjusted each year (n January 1 st ) by a COLA prvided that the funded status f the CUPE Hspitals Shared Risk Plan allws fr it. If the funded status f the CUPE Hspitals Shared Risk Plan des nt allw fr a COLA t be granted in a given year, the increases are carried frward t future years and may be paid if the funded status f the CUPE Hspitals Shared Risk Plan allws fr it in a future year. These rules als apply t any survivr pensin benefit payable. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 7
Retirement under the Plan (cntinued) Hw lng d I have t wrk befre I m entitled t receive a mnthly pensin benefit upn retirement? Yu becme Vested and are entitled t receive a mnthly pensin benefit under the CUPE Hspitals Shared Risk Plan upn the cmpletin f the earlier f: 5 years f cntinuus emplyment; 2 years f pensinable service; r 2 years f membership in the CUPE Hspitals Shared Risk Plan, including membership in any Predecessr Plans. This is yur Vesting Date. Once yu reach yur Vesting Date, yu becme entitled t a mnthly pensin benefit t be payable when yu are eligible t retire. At what age can I retire? Retirement Date Nrmal retirement date: Pensin Prvisins The first day f the mnth cincident with r next fllwing yur 65 th birthday. On yur nrmal retirement date, yu can start t receive yur lifetime pensin with n reductin in pensin benefits because f age. Early retirement date: Any time between yur 55 th and 65 th birthday. On yur early retirement date, yu can start t receive yur lifetime pensin and bridge benefit. A reductin in pensin benefits because f age may apply. Pstpned retirement date: Any time after yur 65 th birthday, but nt beynd the end f the calendar year in which yu reach yur 71 st birthday. On yur pstpned retirement date, yur lifetime pensin will be increased by 3/5% per mnth that yu delayed yur retirement beynd age 65. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 8
Retirement under the Plan (cntinued) What will I receive at the time f retirement? If yu retire n yur nrmal retirement date: Yu will receive a pensin calculated using the annual lifetime pensin frmula previusly described in the sectin Hw is my lifetime pensin calculated? payable mnthly (n bridge benefit included). If yu retire n an early retirement date: Yu will receive a pensin calculated using the annual lifetime pensin and bridge benefit frmula previusly described in the sectin Hw is my lifetime pensin calculated? and What is the bridge benefit?, payable mnthly, and with the fllwing adjustments: Fr the prtin f yur benefit earned prir t July 1, 2012: Yur annual lifetime pensin will be permanently reduced by 3/12% fr each mnth (3% per year) that yur pensin start date precedes yur 60 th birthday. Fr the prtin f yur benefit earned n and/r after July 1, 2012: Yur annual lifetime pensin will be permanently reduced by 5/12% fr each mnth (5% per year) that yur pensin start date precedes yur 65 th birthday. If yu retire n a pstpned retirement date: Yu will receive a pensin calculated using the annual lifetime pensin frmula previusly described in the sectin Hw is my lifetime pensin calculated?, payable mnthly (n bridge benefit included) and with the fllwing adjustments: Yur annual lifetime pensin will be permanently increased by 3/5% fr each mnth (7.2% per year) that yur pensin start date fllws yur 65 th birthday. Are there different frms f pensin that I can chse frm? Yes. If yu are eligible t receive a pensin under the CUPE Hspitals Shared Risk Plan and d nt have a Spuse when pensin payments cmmence, the Nrmal Frm f Pensin is the Life Pensin with Guaranteed Perid f Five Years (detailed n next page). If yu d have a Spuse, the Autmatic Frm f Pensin is the Jint and Survivr Pensin 60% (detailed n next page). There are, hwever, ptinal frms f pensin that yu can select if yur persnal status allws. These ptinal frms f pensin result in the reductin f yur wn pensin t accunt fr the payment f a higher survivr pensin r a lnger perid f guarantee. The different frms f pensin are described n the next page. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 9
Retirement under the Plan (cntinued) Are there different frms f pensin that I can chse frm? (Cntinued) Life Pensin with Guaranteed Perid f 5 Years Payments are made t yu during yur lifetime. If yu die befre receiving sixty (60) mnthly installments, payments are cntinued t yur designated beneficiary r t yur estate (in a lump sum) as applicable, until a ttal f sixty (60) mnthly installments have been paid. This ptin is nly available if yu have n Spuse at yur date f retirement, r if yur Spuse at retirement signed a spusal waiver frm in accrdance with the PBA. Jint and Survivr Pensin 60% Life Pensin with Guaranteed Perid f 10 Years Payments are made t yu during yur lifetime. If yu predecease yur Spuse (refers t the Spuse at retirement), payments are cntinued t yur Spuse during yur Spuse's lifetime at a level equal t 60% (chsen by yu at retirement) f yur lifetime pensin. This ptin is nly available if yu have a Spuse at the date f retirement in accrdance with the PBA. Payments are made t yu during yur lifetime. If yu die befre receiving ne hundred twenty (120) mnthly installments, payments are cntinued t yur designated beneficiary r t yur estate (in a lump sum) as applicable, until a ttal f ne hundred twenty (120) mnthly installments have been paid. This ptin is nly available if yu have n Spuse at yur date f retirement, r if yur Spuse at retirement signed a spusal waiver frm in accrdance with the PBA. Jint and Survivr Pensin 75% r 100% Payments are made t yu during yur lifetime. If yu predecease yur Spuse (refers t the Spuse at retirement), payments are cntinued t yur Spuse during yur Spuse's lifetime at a level equal t either 75% r 100% (chsen by yu at retirement) f yur lifetime pensin. This ptin is nly available if yu have a Spuse at the date f retirement in accrdance with the PBA. Nte: Befre yu make yur chice f pensin ptins utlined abve, it is recmmended that yu thrughly review the nging needs and financial bligatins f yur husehld. This will help yu select the mst apprpriate ptin fr yur situatin. Once an electin is made and pensin payments cmmence, it is irrevcable. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 10
Retirement under the Plan (cntinued) Must I apply fr my pensin? Yes, ne f the mst imprtant things t remember abut yur pensin is that yu must apply fr it. It is nt paid autmatically upn retirement. Cntact yur Human Resurces r payrll ffice as early as pssible, as yu will have t cmplete terminatin dcumentatin which must be frwarded t the Vestcr Pensin Services Crpratin (VPSC) at least 90 days prir t the cmmencement f payment f the pensin benefit. This will ensure, in mst cases, that yu receive yur pensin the mnth fllwing yur date f retirement. Once VPSC receives the terminatin dcuments, payrll and pensin data will be audited and a Preliminary Retirement Statement will be frwarded t yu. Yu must sign and return this dcument t VPSC in rder t receive yur pensin benefit. When will the payment f my pensin ccur? Pensin payments are depsited int yur bank accunt n the 1 st day f every mnth r the last banking day prir t the first f the mnth if it falls n a weekend r hliday. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 11
Leaving the Plan befre Retirement What happens if I terminate emplyment befre retirement? Yu are eligible fr the fllwing ptins upn leaving yur emplyment befre retirement: terminatin f emplyment (prir t Vesting Date)? With less than five years f cntinuus emplyment; less than tw years f pensinable service; and less than tw years f membership in the CUPE Hspitals Shared Risk Plan (including membership in any Predecessr Plans): Yu will receive a refund f yur wn cntributins frm the CUPE Hspitals Shared Risk Plan with accumulated interest. terminatin f emplyment (after Vesting Date and prir t age 55)? With five r mre years f cntinuus emplyment; tw r mre years f pensinable service; r tw r mre years f membership in the CUPE Hspitals Shared Risk Plan (including membership in any Predecessr Plans), yu have the chice t: Defer cmmencement f yur pensin benefit until a date between yur 55 th and 65 th birthday and receive a reduced pensin benefit as described fr Early Retirement under the sectin What will I receive at the time f retirement? and a bridge benefit as described in the sectin What is the bridge benefit? ; r Defer cmmencement f yur pensin benefit until age 65 and receive an unreduced pensin as described fr Nrmal Retirement under the sectin What will I receive at the time f retirement? ; r Transfer yur Terminatin Value in a lump sum t: a lcked-in retirement accunt (LIRA); a life incme fund (LIF); an annuity cntract issued by an assurance cmpany; r yur new emplyer s pensin plan (if the plan allws it). Electin t transfer yur Terminatin Value must be made within 90 days f receiving yur ptins; therwise yu are nly entitled t receive a reduced r unreduced pensin as indicated abve. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 12
Leaving the Plan befre Retirement (cntinued) What happens if I terminate emplyment befre retirement? (cntinued) terminatin f emplyment (after Vesting Date and after age 55)? With five r mre years f cntinuus emplyment; tw r mre years f pensinable service; r tw r mre years f membership in the CUPE Hspitals Shared Risk Plan (including membership in any Predecessr Plans), yu have the chice t: Cmmence yur pensin benefit after terminatin f emplyment at any age prir t yur 65 th birthday and receive a reduced pensin benefit as described fr Early Retirement under the sectin What will I receive at the time f retirement? and a bridge benefit as described in the sectin What is the bridge benefit? ; r Cmmence yur pensin benefit at age 65 and receive an unreduced pensin as described fr Nrmal Retirement under the sectin What will I receive at the time f retirement?. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 13
Benefits upn Death f a Member What benefits are payable upn my death? death prir t retirement? (befre Vesting Date) With less than five years f cntinuus emplyment; less than tw years f pensinable service; and less than tw years f membership in the CUPE Hspitals Shared Risk Plan (including membership in any Predecessr Plans): Yur surviving Spuse (r yur beneficiary if there is n Spuse r if yur Spuse has waived his/her entitlement) will receive a refund f yur wn cntributins t the CUPE Hspitals Shared Risk Plan with accumulated interest. death prir t retirement? (after Vesting Date) With five r mre years f cntinuus emplyment; tw r mre years f pensinable service; r tw r mre years f membership in the CUPE Hspitals Shared Risk Plan (including membership in any Predecessr Plans): Yur surviving Spuse (r yur beneficiary if there is n Spuse r if yur Spuse has waived his/her entitlement) will receive a lump sum equal t the Terminatin Value amunt yu wuld have received had yu terminated service just befre death. death during retirement? The benefit paid will be determined based n the frm f pensin that yu elect at the time f yur retirement. (Refer t sectin Are there different frms f pensin that I can chse frm? ). If yu die befre yur pensin payments cmmence t be paid t yu, yur Spuse will be entitled t receive the death benefits payable under the CUPE Hspitals Shared Risk Plan. If yu d nt have a Spuse at the time f yur death, yur designated beneficiary will receive the death benefit payable. If yu d nt have a Spuse and did nt designate a beneficiary r yur designated beneficiary has predeceased yu, any death benefits will be payable t yur estate. As mentined, if yu have a Spuse, yur Spuse will supersede any beneficiary yu may have designated t receive yur death benefits. Yur Spuse can, hwever, waive his/her entitlement t a pre-retirement death benefit. Please refer t sectin D I need t designate a beneficiary? fr additinal infrmatin regarding the applicable waivers. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 14
Purchasing Prir Service Can I purchase perids f pensinable service? Yu may be able t purchase prir perids f service under this pensin plan. The cst t purchase prir perids f service will vary depending n the type f service purchased. Belw is a list f the varius types f service that may be purchased: If yu are a member with Previusly refunded service under the CUPE Hspitals Pensin Plan / CUPE Hspitals Shared Risk Plan: Cst The cst is the greater f: (i) Amunt f Refund, plus interest; (ii) 1 X Current Cntributin Rate; r (iii) Adjusted Terminatin Value f benefits. A leave f absence withut pay (maternity leave and ther leaves) where: If leave cmmenced prir t July 1, 2012, yu ccupied a permanent full-time psitin immediately prir t leave; r If leave cmmenced n r after July 1, 2012, yu were a member f the CUPE Hspitals Shared Risk Plan immediately prir t leave (cst and service credited n a pr-rated basis if part-time psitin immediately prir t leave). The cst is the greater f: (i) 1 X Current Cntributin Rate; r (ii) Adjusted Terminatin Value f benefits minus Emplyer Cst (1 X Current Cntributin Rate) (applicable if leave is purchased after ne year f recmmencing cntributins in the CUPE Hspitals Shared Risk Plan). A waiting perid prir nn-cntributry fulltime service: The cst is the greater f: (i) 1 X Current Cntributin Rate; r (ii) Adjusted Terminatin Value f benefits. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 15
Purchasing Prir Service (cntinued) What methd f payment can I use t pay fr my purchase f service? Yu can chse ne r a cmbinatin f the methds described belw t pay fr yur purchase f pensinable service: Lump sum payment: persnal cheque; mney rder; using all r part f yur retirement allwance/severance benefits (subject t restrictin); r direct transfer f funds frm a RRSP. Payrll deductins (in additin t regular cntributins) taken fr a set number f pay perids (subject t restrictin). Nte: If yu elect t purchase, interest is charged n the unpaid balance, beginning the first f the mnth fllwing yur electin deadline date. The maximum perid f time t pay is: Equal t the length f service being purchased (i.e. if yu purchased 3 years, yu have 3 years t pay; if yu used yur retirement allwance r yur severance pay, yu must retire within that perid); r Yur terminatin date, whichever cmes first; yur purchase must be paid in full befre yu terminate emplyment (if a purchase f service is planned at retirement, it is suggested that arrangements fr the purchase f service be made at least six mnths prir t retirement t avid pssible delays in payment f yur pensin benefit). Imprtant: Canada Revenue Agency apprval is nrmally required befre purchase f pst-1989 pensinable service can be allwed. The Vestcr Pensin Services Crpratin will autmatically request this apprval nce yur electin frm is received. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 16
Pensin Plan Prvisins in Other Circumstances Can I transfer between pensin plans? The Bard f Trustees may, at its discretin, frm time t time, enter int a reciprcal transfer agreement with the spnsrs f ther pensin plans. The reciprcal agreement permits prtability between pensin plans. There may exist reciprcal transfer agreements that permit transfer f all r part f yur pensinable service in r ut f this pensin plan. If interested in the pssibility f a reciprcal transfer, please cntact yur emplyer. What happens if my marriage/cmmn-law partnership ends? Prvisins under the CUPE Hspitals Shared Risk Plan permit access t the pensin assets n the breakdwn f marriage r cmmn-law partnership. The prvisins fr the divisin f pensin benefits are in effect fr written agreements, decrees and curt rders dated after December 31 st, 1996. Althugh the CUPE Hspitals Shared Risk Plan prvides fr the divisin f a pensin benefit n marriage/cmmn-law partnership breakdwn, ther assets may be used t prvide fr an equal distributin f marital assets. An infrmatin bklet n the prvisins fr the divisin f pensin benefits upn marriage/cmmn-law partnership breakdwn is available thrugh yur Human Resurces r Payrll Office. The bklet is als available at the fllwing website: http://www.vestcr.rg/pensins. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 17
Other Infrmatin Where can I get mre infrmatin? Subject Cntact Questins n pensin plan prvisins and hw they apply t yur situatin: Yur primary cntact is yur Human Resurces r Payrll Office. Vestcr Pensin Services Crpratin Our team f Pensins and Benefits Specialists is available frm 8:15 a.m. t 4:30 p.m., Mnday thrugh Friday. Fr additinal infrmatin regarding pensin ptins: Physical Address: Rm 680, Yrk Twer Kings Place 440 King St. Frederictn, NB E3B 5H8 Mailing P. O. Bx 6000 Address: Frederictn, NB, E3B 5H1 Telephne: 506-453-2296 Tll Free in 1-800-561-4012 Canada: Fax: 506-457-7388 Fr infrmatin regarding the Canada Pensin Plan and Old Age Security: Fr specific persnal infrmatin relative t the Incme Tax Act (Canada): Web Site: Service Canada: Canada Revenue Agency: http://www.vestcr.rg/pensins 1-800-277-9914 (English) 1-800-277-9915 (French) Or visit their website at: http://www.servicecanada.gc.ca 1-800-959-8281 (English) 1-800-959-7383 (French) Or visit their website at: http://www.cra-arc.gc.ca Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 18
Checklist Appraching Retirement When yu are within a year f retirement. Check Cntact the Vestcr Pensin Services Crpratin (VPSC) r yur emplyer fr infrmatin regarding a pensin estimate. Please nte that yu will need t cmplete a pensin estimate applicatin frm and submit it t VPSC. Advise yur emplyer f yur retirement plan at least 6 mnths in advance. Check with yur emplyer abut purchasing eligible service. If yu are currently paying fr a purchase f service, it must be paid in full befre the retirement date in rder fr the additinal service t be included in the pensin calculatin. Yur emplyer will frward terminatin papers t VPSC. VPSC will review the infrmatin received and frward the retirement package cntaining everything yu need t apply fr yur pensin. Upn receiving the retirement package, yu must review, sign and return yur pensin applicatin by the deadline date indicated in yur package. Cntact yur Human Resurce area t inquire abut Grup Life Insurance Cnversin and yur Health and Dental prgrams. Cntact Service Canada regarding the Canada Pensin Plan (CPP) and/r Old Age Security @ 1-800-277-9914. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 19
Summary f Key Prvisins CONTRIBUTION RATE Effective July 1, 2012: Emplyee Cntributin Rate: 9.0% Emplyer Cntributin Rate: 10.1% VESTING Cmpletin f the earlier f: Five years f cntinuus emplyment; Tw years f pensinable service; r Tw years f membership in the CUPE Hspitals Shared Risk Plan, including membership in any Predecessr Plans. CALCULATION OF LIFETIME BENEFIT Annual basic lifetime pensin is the sum f the fllwing: Fr each year (r part year) f pensinable service n r after July 1, 2012: Fr all pensinable service between January 1, 1997 and June 30, 2012: Fr all pensinable service prir t January 1, 1997: Fr all pensinable service: 1.4% X Annualized Pensinable Earnings accrued during the year up t the YMPE fr the year X applicable reductin factr/late retirement factr PLUS 2% X Annualized Pensinable Earnings accrued during the year in excess f the YMPE fr the year X applicable reductin factr/late retirement factr MULTIPLIED BY # f hurs wrked (and cntributed) / 1,950 hurs Pensinable service X 1.4% X Best 5 year average earnings at June 30, 2012 up t the average YMPE X applicable reductin factr/ late retirement factr PLUS Pensinable service X 2% X Best 5 year average earnings at June 30, 2012 in excess f the average YMPE X applicable reductin factr/late retirement factr Pensinable service X 1.75% X Best 5 year average earnings at June 30, 2012 up t the average YMPE X applicable reductin factr/ late retirement factr PLUS Pensinable service X 2.0% X Best 5 year average earnings at June 30, 2012 in excess f the average YMPE X applicable reductin factr/late retirement factr Any Cst f Living Adjustments granted in accrdance with the Funding Plicy YMPE = Year s Maximum Pensinable Earnings used t calculate the Canada Pensin Plan (CPP) cntributins YMPE fr 2017 = $55,300; Average YMPE = 5 year average YMPE (2012 = $47,360) Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 20
Summary f Key Prvisins (cntinued) CALCULATION OF BRIDGE BENEFIT $18 per mnth X number f years f pensinable service up t July 1, 2012 PLUS $18 per mnth X number f years member is a cntributr t the CUPE Hspitals Shared Risk Plan n and after July 1, 2012 Bridge Benefit is subject t any Cst f Living Adjustments granted in accrdance with the Funding Plicy. REDUCTION FACTOR Fr nly the prtin f benefit earned prir t July 1, 2012: Annual lifetime pensin is permanently reduced by 3/12% fr each mnth (3% per year) that pensin becmes effective prir t age 60. Fr nly the prtin f benefit earned n r after July 1, 2012: Annual lifetime pensin is permanently reduced by 5/12% fr each mnth (5% per year) that pensin becmes effective prir t age 65. LATE RETIREMENT FACTOR Annual lifetime pensin is permanently increased by 0.6% fr each mnth (7.2% per year) that pensin becmes effective after age 65 (up t age 71). OPTIONAL FORMS OF PENSION Life Pensin with Guaranteed Perid f 5 Years (Nrmal Frm f Pensin) Life Pensin with Guaranteed Perid f 10 Years Jint and Survivr Pensin 60% (Autmatic Frm f Pensin) Jint and Survivr Pensin 75% r 100% PURCHASE OF PENSIONABLE SERVICE The fllwing types f prir perids f service may be eligible fr purchase: Previusly refunded service frm CUPE Hspitals Pensin Plan/CUPE Hspitals Shared Risk Plan; Leave f absence withut pay (maternity leave and ther leaves); and Waiting perid prir nn-cntributry full-time service. Disclaimer: This bklet is fr infrmatin purpses nly. N rights are cnferred by this bklet. Fr authritative wrding regarding this pensin plan, please refer t the CUPE Emplyees f New Brunswick Hspitals Shared Risk Plan Text. As there may be revisins t this bklet frm time t time, members shuld access the nline versin f this bklet available at http://www.vestcr.rg/cupe1252 t ensure that they have the current versin f the bklet. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 21
Glssary Adjusted Terminatin Value: means the actuarial present value f a benefit which is calculated using the discunt rate fr the calculatin f the funding plicy liability. It wuld als include the value f vested and certain nn-vested Ancillary Benefits (such as early retirement subsidies and bridge benefits) and wuld be adjusted t take int accunt the mst recently determined terminatin value funded rati f the plan, if it is greater than 1.0. Ancillary Benefits: means benefits that are in additin t the Base Benefit, such as cst f living adjustments, early retirement subsidies, bridge benefits and pstpned retirement benefits. Annualized Pensinable Earnings: means pensinable earnings in a calendar year befre deductins and excluding vertime r ther fluctuating payments, divided by the rati between the number f hurs wrked (n which pensin cntributins were paid) and the annual full-time equivalent hurs (1,950 hurs). Example: pensinable earnings f $35,000 ver a perid f six mnths in a given year (wrking full-time) wuld amunt t $70,000 in annualized pensinable earnings ($35,000 divided by (975/1,950 hurs)). Base Benefit: means the amunt f pensin paid r payable t a member at any given time. Cst f Living Adjustment (COLA): means the increase applied t the lifetime pensin and bridge benefit (if any) based n all r a prtin f the changes in the Cnsumer Price Index averaged ver 12 mnths. COLA is applied based n the Cnditinal Indexing prvisin. Cmmn-Law Partner: means a persn wh is nt r was nt married t the member r frmer member, but is r was chabiting in a cnjugal relatinship with the member r frmer member fr a cntinuus perid f at least tw years immediately befre the date in questin. Cnditinal Indexing: means indexing pensin benefits when the funding status f the plan permits it. Cnversin Date: means July 1 st, 2012 the date the Pensin Plan fr CUPE Emplyees f New Brunswick Hspitals was cnverted t the CUPE Hspitals Shared Risk Plan. Current Cntributin Rate: means in the cntext f Purchase f Service, the required cntributins fr the perid being purchased based n the CUPE Hspitals Shared Risk Plan cntributin rate and the emplyee s earnings in effect at the date f applicatin. Enhanced Career Average: means that the member s pensin will accrue n a career average basis and that the member s pensinable earnings will be indexed each year if the plan s funded status allws fr it. Funding Plicy: means a dcument in respect f the CUPE Hspitals Shared Risk Plan which sets ut certain parameters established by the parties t address key funding and benefit features f the CUPE Hspitals Shared Risk Plan. These features include the timing and level f increases r decreases in the cntributin rate, whether COLA will be granted and the level f such COLA, whether Ancillary Benefits and/r Base Benefits have t be adjusted, up r dwn, all depending n the level f the plan s funded status and risk management gals. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 22
Glssary (cntinued) Spuse: means either f tw persns wh: are married t each ther; are married t each ther by a marriage that is vidable and has nt been vided by a declaratin f nullity; r have gne thrugh a frm f marriage with each ther in gd faith that is vid and have chabited within the preceding year. Predecessr Plans: means the CUPE Hspitals Pensin Plan, the Pensin Plan fr Part-Time and Seasnal Emplyees f the Prvince f New Brunswick and the Pensin Plan fr Emplyees f New Brunswick Hspitals. Terminatin Value: means the value f the member s Base Benefit at date f terminatin f emplyment, adjusted fr the funded status f the plan, and calculated in accrdance with the requirements f the Pensin Benefits Act. Vested: means a status whereby a member becmes irrevcably entitled t pensin benefits as a result f reaching his r her Vesting Date. Vesting Date: means the date upn which a member becmes Vested. This is the date that a member first attains 5 years f cntinuus emplyment, 2 years f pensinable service, r 2 years f plan membership in the CUPE Hspitals Shared Risk Plan, including membership in any Predecessr Plans. Year s Maximum Pensinable Earnings (YMPE): means the maximum earnings level used t determine emplyer and emplyee cntributins t the Canada Pensin Plan (CPP). The federal gvernment increases this amunt every year accrding t a measure f increases in wages in Canada. Shared Risk Plan fr CUPE Emplyees f New Brunswick Hspitals 23