Purchase of additional Pension Credits

You can purchase additional pension credits only under the following conditions:

a) you have a minimum of 36 months seniority

b) you worked less than 250 days in the current year

c) you cannot purchase more service than was earned in one of the past two years of service

d) you cannot purchase more than 5 years of service (plus three years for parenting)

e) payment must be received in the same calendar year the credits are being purchased for

Cost of Purchasing Pension Credits

You pay both the employee and employer contributions for each day you purchase. The employee rate will depend on your age (please refer to section 2) and the employer contribution rate is currently 10%.

For example: If your daily rate is $150.00 and your age is 45 you would pay $22.50 per day you purchase. A total of 15% of your daily rate.

Daily Rate	$150.00
Employee Contribution	5%
Employer Contribution	10%
Total Contribution	15%

Formula: 150.00 x 15% = $22.50 cost per day of service

To determine how much annual pension this will buy you, take your daily rate x 1.75%, and multiply this by the number of days you are purchasing.

For example: If you are buying 10 days at $22.50 each, it would cost you $225.00.

Daily Rate $150.00 x 1.75%=$2.63                                                   

$2.63 x 10days = $26.30 annual pension

The Effect of Purchasing additional Pension Credits

Depending on how many years you are short days of pay at the end of your career will vary the impact on your pension. If you only have a few days short in a year the impact would be minimal. If you move from full-time to job sharing the greater the impact on your pension at retirement.

The impact varies because the days of pay affect how many years of service will be used for your pension calculation (see page 14 to 15 for pension calculation). If you have less than 250 days of pay in a year you will not receive a full years credit of 1; you will only receive a prorated credit for the year based on the days reported by the Company.

For example:

a) If you worked for 25 years but in 10 of the 25 years you only worked 230 days, you would have earned approx. .92 per year over 10 years and 1 year for each of the other 15. Your total service would then equal 24.20 years instead of 25.

b) If you worked for 25 years but in 10 of the 25 years you job shared 50% of the time, you then would have only earned .50 per year over 10 years and 1 year for each of the other 15. Your total service would then equal 20 years instead of 25.