Pension FAQs

Who is eligible to join the pension plan?
The plan is expected to launch in 2027. Beginning on this date, new members of the locals/guilds that have signed participation agreements with the pension plan, will join the pension plan. Members of these locals/guilds who were already enrolled in the Group RRSP can either continue with that program OR elect to have future contributions directed to the pension plan.

If I join the pension plan, can I transfer my Group RRSP account balance into the pension plan?
Yes, existing members of the Group RRSP who decide to join the pension plan will be offered the option to transfer their account balance that has resulted from eligible past service into the pension plan (called a pension “buyback”/credit). This will be completely voluntary. Members considering a pension buyback can receive information regarding the amount of pension they are eligible to buyback based on their own personal information and account balance. You may still join the pension plan on a go-forward basis even if you decide to retain your Group RRSP.

If I am employed through my own corporation, am I able to participate in the pension plan?
Yes, it is expected you will be able to participate in the pension plan. More information will be provided at a later date.

Will the members’ and employers’ contribution amounts change under the new pension plan?
Contributions from both members and employers will be defined in the collective bargaining agreements and are unlikely to change under the new pension plan. If there are changes, it will only happen if there are collectively bargained changes.

What if I want to save more than the required contributions in the collective bargaining agreement?
Pension plan contributions will be limited to the amounts set out in the collective agreement. However, all current and new members will still have access to the group retirement savings accounts for additional savings.

Are my pension plan contributions taxable?
No, pension contributions are generally tax deductible, meaning they are taken from your gross pay which immediately lowers your overall taxable income for the year.

How is taxation different between the pension plan and the Group RRSP?
Like the Group RRSP, you will not be taxed on contributions to the Pension Plan. The difference is that with the Pension Plan, no tax will be withheld on contributions by the employer, meaning there is no need to wait for tax season to claim the amount deducted from your salary as an RRSP contribution. Like the Group RRSP, your pension amounts will be taxable when they are paid to you.

Do the contributions to the pension plan affect my RRSP contribution room?
Yes, both member and employer pension contributions affect your RRSP room. At the end of the year, a Pension Adjustment (“PA”) is calculated, which is equal to the total pension contributions made on your behalf. This PA is reported on your T4 and reduces the RRSP contribution room available to you next year. Pension plan contributions reduce your RRSP room because both pension plans and RRSPs are tax-advantaged savings vehicles, and CRA limits the total tax-advantaged savings available to all Canadians.

How much will my pension be?
The current annual pension formula is 12% of annual contributions. Your annual pension grows by 12% of the contributions made on your behalf each year. The formula that applies to buyback of eligible service may differ.

What happens when I die?
If you pass away prior to retirement, your spouse or beneficiary will be entitled to the equivalent value of your pension entitlement earned to date either as a lump sum or a deferred pension depending on your province. If you pass away after retirement, your spouse or beneficiary may be entitled to either a continuing pension or any remaining guaranteed payments, depending on your marital status at retirement and the options you chose at retirement. In particular, your spouse may have certain legal entitlements to a death benefit or survivor pension that apply unless they are formally waived. The default option will be for a pension to continue at 60% for married members, or ten years of guaranteed payments from pension commencement for single members.

Will pension amounts be automatically indexed to inflation?
No, pension will not be automatically indexed to inflation.

Will I be able to take advantage of the Home Buyers’ Plan or Lifelong Learning Plan that is currently available through the Group RRSP?
No, members will not be able to take advantage of these programs through the pension plan; this is not currently permitted under pension legislation. A key goal of the pension plan is to ensure that contributions are used for retirement. CEIRP’s other savings plans like the RRSP, NRSP and TFSA will still be available on a voluntary basis to pension plan members.

Can I access pension funds if I am going through financial hardship?
No, the pension plan will not allow for withdrawals from a registered pension plan due to financial hardship. Funds must remain in the plan and are “locked-in” which means they must be used to provide a periodic lifetime income in retirement. Depending on the province where you live and/or where your locked-in account resides, you may be eligible to unlock your funds.