Nov. 17, 2016
The Canadian Labour Congress has denounced a federal target benefit bill as a “betrayal,” but Osler partner Jana Steele argues Bill C-27 is a better option, according to an article by Sara Tatelman in Benefits Canada. Jana, a partner in Osler’s Pensions & Benefits Group, says that the new option — which would allow employers that are federally regulated to establish target benefit pension plans, and convert existing defined benefit plans to the former — allows more flexibility.
“Quite frankly, I was shocked by [the Canadian Labour Congress’s] position on this bill because in my view, employers are already leaving defined benefit plans and their only other option right now is defined contribution . . .,” Jana tells Benefits Canada.
“This would give another option, in the case of unions, to be bargained if an employer is looking to exit DB ... A target benefit plan is arguably preferable from an employee’s perspective than a DC plan.”
Jana goes on to explain the advantages of target benefit plans and describes why she supports the federal legislation.
“I think target benefit plans should be available as a design option,” Jana tells Benefits Canada. “It does give employers another tool in the pension toolbox to select from.”
Read more in Sara Tatelman’s article “Federal target benefit bill denounced as ‘unconscionable betrayal’” in Benefits Canada.