IN THE MATTER OF the Pension Benefits Act, R.S.O. 1990, c. P.8, as amended (the “Act”);
AND IN THE MATTER OF a Wind up Report prepared and filed by Eckler Partners Ltd. on behalf of Canron Construction Limited dated June 3, 2004, with respect to the wind up of the Pension Plan For the Hourly Employees of Canron Construction Inc Registration No. 1044288 (the “Plan”) effective December 31, 2003.
Canron Construction Inc.
100 Disco Road,
Rexdale ON M9W 1M1
J.S. (Paul) Kandola
Vice President and General Manager
Employer and Administrator of the Plan
Eckler Partners Ltd.
110 Shepard Avenue East, Suite 900
Toronto ON M2N 7A3
Iain G. Potter
300 Mill Road
Etobicoke ON M9C 4W7
President, The Employees Association of Canron Inc.
NOTICE OF PROPOSAL
I PROPOSE TO ORDER Canron Construction Inc. to file a revised wind up report under clause 88(2)(c)of the Act within 30 days of the date of this Notice of Proposal, with respect to the wind up of the Plan and the wind up report filed on June 9, 2004. The revised wind up report shall include the provision for the payment of benefits under clause 8.02(d) of the Plan (the “bridge benefits”) for all plan members affected by the wind up who had a combination of age plus years of service totalling 85, or if they had age plus years of service totalling 55, would have grown into age plus years of service totalling 85 at retirement.
REASONS FOR THE PROPOSED ORDER:
- The Plan was wound up effective December 31, 2003. A wind up report was filed with the Superintendent on June 9, 2004. The initial report identified the bridge benefit payable under clause 8.02(d) of the Plan and quantified the liability associated with the bridge benefit as being $296,000. However, it did not include the bridge benefit as a plan liability on the basis that the members who were entitled to the bridge benefit had accepted a severance package, terminating their employment, and the bridge benefit was only available on retirement.
- Subsection 74(3) of the Act provides that bridging benefits offered under the pension plan to which a member would be entitled if the pension plan were not wound up and if the membership of the member were continued shall be included in calculating the pension benefit under subsection 74(1) of a person who has at least ten years of continuous employment with the employer or has been a member of the pension plan for at least ten years.
- The members entitled to the bridge benefits in question had their membership in the plan terminated as a result of the wind up of the plan. The decision to wind up the plan was due to a decision of the employer to cease operation at its Rexdale facility and terminate all hourly employees effective December 31, 2003. The wind up report has reflected this by calculating other benefits for these members in accordance with clause 8.02, the early retirement benefit provisions of the Plan, instead of the termination of membership provisions in clause 12.
- Accordingly, subsection 74(3) applies for the purposes of determining benefits on plan wind up. The members in question would have become entitled to the bridge benefit had the plan not been wound up and, therefore, must be provided with the bridge benefits upon wind up.
- Such further reasons as may come to my attention.
YOU ARE ENTITLED TO A HEARING by the Financial Services Tribunal (the “Tribunal”) pursuant to s. 89(6) of the Act. 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
North York ON M2N 6L9
Attention: The Registrar
For further information, contact the registrar of the Tribunal by phone at
416-226-7752, toll free at 1-800-668-0128, ext. 7752, or by fax at 416-226-7750.
IF YOU FAIL TO REQUEST A HEARING WITHIN THIRTY (30) DAYS, I MAY MAKE THE ORDER AS PROPOSED IN THIS NOTICE.
DATED at Toronto, Ontario, this 27th day of January, 2006.
K. David Gordon
Deputy Superintendent, Pensions
Copy: Priscilla H. Healy
Pallett Valo LLP
*NOTE—PURSUANT to section 112 of the Act any notice, order or other document is sufficiently given, served, or delivered if delivered personally or sent by first class mail and any document sent by first class mail shall be deemed to be given, served, or delivered on the seventh day after mailing.