Responsibilities | Pension Plans
Information for Pension Plan Members

Minimum Requirements for Vesting and Locking-in

"Vesting" is your right as a plan member:

• to the pension benefit earned under the plan's formula (if you are a member of a defined benefit plan), or
  
  
• to the contributions made by your employer on your behalf (if you are a member of a defined contribution plan)

Once your pension vests, you are entitled to receive your accrued benefits at retirement, even if you terminate employment before retirement age.

Under the PBSA, pension benefits are vested after 2 years of continuous plan membership.

Benefits are also vested at the age you would normally be eligible to collect a full pension (e.g. 65 years), or if your employer's pension plan is terminated, regardless of years of plan membership.

Some plans vest pension benefits earlier than the 2 year minimum standard required by the PBSA.

All vested benefits resulting from service after 1992 are "locked-in" . The term "locked-in" means that benefits must be used to provide you with a pension at retirement. The vested benefits cannot be paid out in cash if you leave your job. These may either be left in the plan or may be transferred out of the plan to one of the locked-in alternatives permitted under the PBSA.

The commuted value of benefits earned before January 1, 1993, or contributions to the plan made prior to January 1, 1993, and any interest on those contributions earned either before or after that date, are not locked-in by the PBSA. These benefits, however, may be locked-in by the terms of your plan.

If you leave your job before your benefits are vested (i.e. before you have completed 2 years of continuous plan membership), you are entitled to a refund of your own contributions, with interest. You are not entitled to your employer's contributions to the plan until you are vested.


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