Pension Division on Marriage Breakdown

In the event of separation or divorce a claim may be made against your pension. The Plan Office will perform the division calculation provided there is a separation agreement or Court Order which divides the pension in accordance with Part 6 of the Family Relations Act, and provided the necessary Family Relations Act forms are filed.

 

Family Relations Act Forms

Form 1 - Claim of Spouse to interest in Member's Pension

The former spouse submits the Form 1 to notify the Plan that they intend to apply for a claim against the member's pension, or that they simply want information in order to determine if a claim is warranted. It should only be used in cases where no Court Order or Separation Agreement exists, and is normally only used so the former spouse can receive information directly from the Plan, and to provide some measure of protection for the former spouse in the event the member attempts to "dispose of" or make some election with regard to their pension.

Form 2 - Request for Designation as a Limited Member

The former spouse submits the Form 2 to be designated as a Limited Member, making claim against the member's pension. The Form 2 may only be submitted when a Separation Agreement or Court Order exists that actually divides the pension, and a complete copy of the document must be submitted with the Form 2.

If the plan member is over age 55 and has not retired the division is considered un-matured, and the Limited Member has two options. They can elect to either receive a separate pension at the same time as the member, or to transfer their share to a locked in RRSP.

If the Plan member has already retired and is in receipt of pension payments the division is considered matured. The limited member is only entitled to a proportionate share of the actual pension in payment, and they will not qualify to make any election of their own with regard to beneficiary coverage, or a transfer.

The Limited Member may only make an election with regard to their share of the pension if the plan member has reached age 55. The exception is if the Plan member terminates their employment prior to age 55 AND elects to transfer their own share of the pension out of the Plan. At this time the Limited Member has no choice but to transfer their share out at the same time.

Form 4 - Request by Limited Member for Transfer or Pension

The Limited Member submits the Form 4 to make an election with regards to their share of the pension. The Limited Member may elect to transfer their share of the pension once the plan member has reached age 55, or they may elect a separate pension option.

If the Limited Member elects to receive their share as a lump sum the Form 4 should not be submitted until the member reaches age 55 as the date of receipt of the Form 4 becomes the date at which the Limited Member's share is valued.

If the member elects the separate pension they have no choice of the retirement date, but they will be offered their own retirement options and beneficiary coverage.

Form 5 - Request in relation to a Matured Pension Divided under an Agreement or Court Order made before July 1, 1999

A former spouse who is already receiving payments directly from the Pensioner for their share of the pension can file a Form 5. It allows for the Plan to make separate payments to each party, with separate source deductions. The form must be filed along with a complete copy of the Separation Agreement or Court Order.

Form 6 - Notice of Receipt

The Plan is obligated to notify the Plan member when the former spouse has filed a Form 1 or 2 by sending the member a completed Form 6.

 

Pension Division Formula

The pension division formula specified under Part 6 of the Family Relations Act is,

A / B X 50% , where A = the number of years of membership service accrued by the Plan member from the date of marriage to the date of entitlement, and B = the total number of years of membership service accrued by the Plan member for the entire period of the pension, up to the date of the event being calculated.

 

Administration Fee

The spouse and member are responsible for paying to the plan the applicable administration fee. A spouse or member who pays more than a half share of the administration fee may recover from the other the additional amount paid. The Plan charges an administration fee of $500.00, or $250.00 if the member is already in receipt of the pension.