Responsibilities | Pension Plans
Information for Pension Plan Members

Minimum Employer Contribution - 50% Rule
If you are required to contribute to a defined benefit plan, your employer must pay for at least 50% of the cost of the pension earned after January 1, 1993.

On termination or retirement, employee contributions in excess of 50% of the value of the accrued pension must either be returned to you, transferred to another pension plan, RRSP or LIF, used to purchase an annuity from an insurance company, or used to increase the pension benefit.

Most public sector pension plans are exempt from the 50% rule because they provide for preretirement indexing of the salary base used to calculate deferred pensions. Other pension plans may also apply for an exemption if they provide preretirement indexing that meets the criteria specified in the regulations.


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