Pension Reform - Ontario Retirement Pension Plan (ORPP)

March 18, 2016

The deadline of January 1, 2020 for the Ontario Retirement Pension Plan (ORPP) to be fully phased in and operational has been confirmed. The Ontario Minister of Finance recently announced the government’s plan to delay the first wave of implementation by one year to January 1, 2018.

OMERS members will not be affected by the ORPP. 

OMERS will be considered a “comparable plan” under the ORPP, and, as a result, members of the OMERS Plan will not be affected by the ORPP.  However, any employees who are not in OMERS by January 1, 2020 will be affected. 

OMERS and its employers will need to address the issue of non-full-time employees who are not currently members of the OMERS Plan. Although OMERS employers can make the OMERS Plan mandatory for their non-full-time employees, not all employers have elected to do so.  The OMERS Sponsors Corporation (SC) is reviewing options related to non-full-time employees who are not currently enrolled in the OMERS Plan. 

The Ontario government’s goal continues to be that every employee in the province be enrolled in the ORPP, or a comparable workplace pension plan if they earn more than $3,500 per year, regardless of the nature of their employment (i.e. contract, seasonal, etc.).

Additional information on ORPP for employers is available at this Province of Ontario site.

This link connects to the technical briefing with all the ORPP details that have been decided to date.

Legislation setting out comprehensive ORPP details is expected to be presented this Spring.

Pension Reform - Canada Pension Plan

Expansion of the CPP is a priority of the federal government. The federal Finance Minister is engaged in discussion with provincial leaders on potential CPP enhancements.  Any change requires support of 2/3 of the provinces representing at least 2/3 of the population.  It could take time to reach an agreement.

There are different ways the CPP could be expanded and, given the number of approaches that could be considered, it is too early to provide clarity on what this might mean for OMERS, our members and employers. We will provide updates as information becomes available. 

Ontario Retirement Pension Plan (ORPP) for Ontarians

September 9, 2015

The Ontario government has been developing its Ontario Retirement Pension Plan (ORPP) for Ontarians who do not have a comparable workplace pension plan. On August 11th, Premier Kathleen Wynne announced key details about the design of the ORPP, which will be phased in over the next three years.

The province clarified two key design elements which will impact OMERS and our members, employers and stakeholders. First, members of comparable pension plans such as OMERS will not be required to join the ORPP. Second, part-time and other non-full-time employees, who are not currently enrolled in OMERS, will need to either enroll in OMERS or the ORPP, as the government’s overarching philosophy is "coverage for all workers." The timeline for this second item is to be completed for no later than December 31, 2019.

Key Components of the ORPP

  • Employees and employers will contribute 1.9% each (3.8% combined) of an employee’s annual earnings up to $90,000.
  • Earnings above $90,000 (in 2014 dollars) will be exempt from ORPP contributions.
  • The retirement benefit depends upon how many years members contribute to the ORPP and their earnings throughout those years.
  • Other details, such as minimum income thresholds, are still to be determined.

How Does this Impact You?

The government made it clear that all employees must be in the ORPP or a comparable workplace plan by January 1, 2020.

  • Members: No impact on existing OMERS members and their employers.
  • Part-time and non-full-time employees: Employees who are not currently enrolled in OMERS will need to either be enrolled in OMERS or the ORPP by December 31, 2019.

Next Steps

OMERS continues to participate in discussions with government on the ORPP and is monitoring the development of a potential CPP expansion, to assess the implications and determine next steps.

We are committed to keeping you informed throughout this process.

For more information on the ORPP, click here.