Skip Ribbon Commands
Skip to main content

Algoma University College - May 24, 2007

IN THE MATTER OF the Pension Benefits Act, R.S.O. 1990, c. P.8, as amended (the “PBA”)

           

AND IN THE MATTER OF a Proposal of the Superintendent of Financial Services to Make an Order under sections 87 and 19 of the PBA respecting a request by Mr. John Diluzio relating to the Algoma University College Pension Plan, Registration Number 0575209.

 

 

TO:                

Mr. John Diluzio
100 Parkshore Drive
Sault Ste. Marie, ON
P6A 6B3

 

Applicant

 

 

AND TO:    

Algoma University College
1520 Queen Street. East 
Sault Ste. Marie, ON
P6A 2G4

           

ATTN:

Ms. Celia Ross
President

 

NOTICE OF PROPOSAL

 

I PROPOSE TO MAKE AN ORDER in respect of the Algoma University College Pension Plan (the “Plan”) requiring Algoma University College to administer the Plan in accordance with Article 9 of the Plan.

 

 

REASONS:

 

  1. Mr. Diluzio commenced employment with Algoma University College in 1990, and became a member of the Plan in 1993.

  2. Mr. Diluzio commenced a medical leave on February 23, 2003.  Six months later he was approved under Algoma University College’s Long Term Disability plan with RBC Insurance and commenced receiving monthly benefits from RBC. 

  3. Mr. Diluzio continues to receive regular and ongoing medical treatment.  Mr. Diluzio also continues to receive benefits under Algoma University College’s Long Term Disability plan with RBC.

  4. By letter dated November 25, 2005 Mr. Diluzio was terminated from employment with Algoma University College effective December 5, 2005.  It appears from the letter that Mr. Diluzio’s employment was terminated because he had been absent from his position since February 23, 2003 and the most recent letter from his doctor, Dr. Hopgood, stated that Mr. Diluzio was not able to perform any duties of his position, with or without reasonable accommodation.  The letter states that it is also Algoma University College’s position that “the contract of employment may be severed based on frustration”.

  5. Mr. Diluzio continued to make monthly pension contributions to the Plan until February 2006 at which time he received a letter from Algoma University College reiterating that Dr. Diluzio’s employment at Algoma University College had been terminated effective December 5, 2005 due to frustration of contract.  Algoma University College has refused to accept any further contributions to the Plan from Mr. Diluzio after February 2006.

  6. Mr. Diluzio contends that Algoma University College’s refusal to accept any further contributions from him and not to allow him to continue to accrue pension benefits is contrary to Article 9 of the Plan.  Article 9 of the Plan provides in part as follows:

    9.1 Continued Accrual of Benefits While Disabled

     

    (a)        A Member who is on a period of disability due to a physical or mental impairment that prevents the Member from performing the duties of the employment in which he was engaged before the commencement of the impairment as certified by a medical doctor approved by the Employer and who is receiving income from the long-term disability plan of the Employer shall remain a Member of the Plan.  Such a Member shall continue to accrue pension benefits pursuant to section 5.1, provided he agrees to make contributions in accordance with Section 4.2(b) in respect of the period of disability.

    (b)        If the disabled Member does not return to active employment with the Employer, he shall cease to be a Member on his Normal Retirement Date and shall be entitled to receive an annual pension commencing on his Normal Retirement Date.  …


  7. It is Algoma University College’s position that membership within the Plan ceases upon termination of employment.  It submits that the intent of Article 9 is to extend plan coverage to employees who are unable to work as a result of disability.  It submits, however, that it is clear from reading the provision that coverage only extends to inactive employees who otherwise remain in the employ of Algoma University College.  Algoma University College submits that because Mr. Diluzio ceased employment after December 5, 2005, Article 9 has no application.

  8. Article 9 sets out two criteria for continuing membership in the Plan:  (a)  a Plan member must be “on a period of disability due to a physical or mental impairment that prevents the Member from performing the duties of the employment in which he was engaged before the commencement of the impairment as certified by a medical doctor approved by the Employer…” and (b) a Plan member must be “receiving income from the long-term disability plan of the Employer”.

  9. Mr. Diluzio has satisfied the two criteria for continuing membership in the Plan:  Algoma University College is not challenging Dr. Hopgood’s opinion that Mr. Diluzio is unable to perform the duties of his position and Mr. Diluzio continues to receive income from the Algoma University College’s Long Term Disability plan.

  10. Article 9(1)(b) indicates that once a member has satisfied the condition of disability due to a physical or mental impairment that prevents him or her from performing the duties of the employment in which he or she was engaged before the commencement of the impairment, membership in the Plan can continue to Normal Retirement Date, i.e., age 65 (in Mr. Diluzio’s case this would occur on June 24, 2015) if the disabled member does not return to active employment at which time he would be entitled to receive an annual pension.

  11. By refusing to accept pension contributions from Mr. Diluzio and to not allow him to accrue pension benefits pursuant to the Plan, Algoma University College is not administering the Plan in accordance with the terms of the Plan provisions.  Mr. Diluzio wishes to continue making contributions to the Plan in respect of his period of disability and should be allowed to do so and to continue to accrue benefits under the Plan until he is no longer in receipt of Long Term Disability benefits or he reaches Normal Retirement Date.

  12. Such further reasons as may come to my attention.

 

YOU ARE ENTITLED TO A HEARING by the Financial Services Tribunal (the “Tribunal”) pursuant to section 89(6) of the PBA. To request a hearing, you must deliver to the Tribunal a written notice that you require a hearing, within thirty (30) days after this Notice of Proposal is served on you.*

 

YOUR WRITTEN NOTICE must be delivered to:

Financial Services Tribunal
5160 Yonge Street
14th Floor
Toronto, Ontario
M2N 6L9

 

Attention: The Registrar

 

FOR FURTHER INFORMATION on a Form for the written notice, please see the Tribunal website at www.fstontario.ca or contact the Registrar of the Tribunal by phone at 416- 590-7294, toll free at 1-800-668-0128, ext. 7294, or by fax at 416-226-7750.

 

IF YOU FAIL TO REQUEST A HEARING WITHIN THIRTY (30) DAYS, I MAY CARRY OUT THE PROPOSAL AS DESCRIBED IN THIS NOTICE.

 

DATED at Toronto, Ontario, this 24th day of May, 2007.       

 

___________________________
K. David Gordon
Deputy Superintendent, Pensions

* NOTE - Pursuant to section 112 of the PBA any Notice, Order or other document is sufficiently given, served or delivered if delivered personally or sent by regular mail and any document sent by regular mail shall be deemed to be given, served or delivered on the seventh day after the date of mailing.