Disability leave and your pension
If you are receiving workplace disability benefits,
you may have many questions about what to
expect. As a member of the CAAT Pension Plan,
you can rest assured that your pension will continue
to grow, as described in this brochure. In fact, you
don’t need to do anything to secure your pension.
We’ll connect with your employer, so you can relax
about your retirement.
Is this booklet for you?
This pamphlet describes how you continue to build your pension while receiving workplace disability benefits.
A detailed legal description of the provisions of the Plan can be found in the Plan Text, which can be accessed at your employer’s Human Resources department or downloaded from our website. Should the information in this booklet, our website or any other source differ from the Plan Text, the Plan Text will govern.
WORKPLACE DISABILITY BENEFITS
Disability income may come from one or several sources depending on your circum-stance. If you are receiving workplace disability benefits either through the Workplace Safety and Insurance Board (WSIB) total disability benefits, or through Long Term Disability (LTD) benefits under your employer’s benefit program, you will retain your membership in the CAAT Plan. Once your disability benefits begin, you and your em-ployer stop contributing to the CAAT Plan and you continue to accrue a pension based on your deemed earnings. You will continue accruing pensionable service towards your pension for as long as you receive workplace disability benefits or until you retire (whichever comes first).
The calculation of your pension will be based on:
• Your pensionable service, which will include any service for the period you received workplace disability benefits.
• Your Highest Average Pensionable Earnings, which will be the 5 consecutive years your earnings were highest (including years of deemed earnings). If you started disability leave before July 1, 2016
• You continue to accrue a pension, and will not make contributions.
• Starting with the first calendar year of disability and thereafter, your pension accrues at a rate of 2% on all your earnings (in your first, partial year your pension accrued at 1.3% and 2%).
If you start disability leave on or after July 1, 2016
• You will continue to accrue a pension, and will not make contributions.
• Your pension will accrue at a rate of 1.3% and 2% for the entire duration of the disability period.
WHEN DO DISABILITY ACCRUALS END?
Generally speaking you will continue to accrue a pension under the CAAT Pension Plan with no contributions as long as you receive workplace disability benefits. Please note that if you accept a lump sum settlement of your workplace disability benefit in lieu of a monthly income stream, you workplace disability benefits will be considered to have ended. Your employer will generally advise the Plan when your workplace disability benefits are over. This may happen when you reach one of the following milestones:You return to work
Once you return to regular active employment, you and your employer will resume contributing to the Plan. When you retire, your benefit will be based on your highest average pensionable earnings and the pensionable service you have accumulated in the Plan, including the period of pensionable service you accrued while receiving disability benefits.
You terminate your employment at a CAAT Plan employer
If, following the end of your workplace disability benefits, you do not return to work and you terminate employment, then you will stop accruing a pension. If you are under age 65 (which is your normal retirement date) you will start the 24-month extension of Plan membership period. If you are age 55 or age 50 with 20 years of service, you can opt to start your early pension immediately.
If your employment is terminated while you are still receiving workplace disability ben-efits, you remain a member of the Plan and continue to earn a pension as if you were still employed, as long as you continue to receive your workplace disability benefits. Your pension accrual would then end on the earlier of:
• the date your workplace disability benefits end, • the date you choose to start early retirement or • the end of the month in which you turn 65.
You retire
Once you are eligible to retire, you may do so at any time while in receipt of your workplace disability benefits. You are eligible to retire when you become age 55, or age 50 if you have 20 years of service. If you choose to retire, you stop accruing a pension, and start receiving monthly pension payments from the CAAT Plan. You must determine for yourself how starting your pension would impact your workplace disabil-ity benefits.
When you reach your normal retirement date (the month in which you turn 65), if you don’t return to employment, you must start collecting the pension you earned in the CAAT Plan regardless of whether you are still in receipt of your workplace disability benefits.
You die
If you pass away while accruing a pension under the CAAT Plan and receiving workplace disability benefits, you will be considered to have died as an active Plan member and your survivors will receive the death benefit options for ‘pre-retirement death’. Any death benefit payable to your beneficiaries will be calculated based on your highest average pensionable earnings and the pensionable service you earned up to your death, including the period of pensionable service you accrued while you were receiving disability benefits.
MEET TRUDY
Trudy will be retiring this year at age 65. Her 33 years of service in the Plan includes two years (before July 1, 2016) during which she received LTD benefits as a result of an accident. Trudy’s highest average pensionable earnings (HAPE) is $89,000. When her pension is calculated, the tiered formula of 1.3% and 2% will be used for all but her LTD service. For the portion of her LTD service during which she accrued a pension at 2%, her pension will calculated using 2% x her total HAPE. Trudy’s total lifetime pension is $49,010 a year. She’ll receive it as a monthly payment of $4,084.16, paid for the rest of her life – as well as inflation protection annually, when it is granted. Her Annual Statement every year shows the service that accrued at 2% during her disability leave.
If Trudy had started disability after July 1, 2016, her pension would be calculated using the tiered formula (1.3% and 2%) for all 33 years of her service.
WSIB partial disability benefits
In the case of WSIB partial disability benefits, you accrue pensionable service in the CAAT Plan only during the first year of collecting the benefit. For details on WSIB partial disability and the effect on your CAAT Plan pension in the sec-ond and subsequent years, contact your Human Resources representative.
CONCERNS? CONTACT US
If you have questions about how your disability leave will affect your pension, don’t hesitate to contact your CAAT Plan employer’s Human Resources department or the CAAT Pension Plan.
Email: member@caatpension.on.ca
Phone: 416.673.9000
Tollfree: 1.866.350.2228
Fax: 416.673.9028 www.caatpension.on.ca
