University of Windsor New Faculty Orientation 2006

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University of Windsor New Faculty Orientation
2006

• Welcome !
• Monday, July 10, 2006

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Overview

• Types of Pension Plans
• Faculty Pension Plan
• Life as an Active Member
• Joining the Pension Plan
• Retirement
• Survivor Options
• Terminating Membership
• Past Service Pension Adjustments
• Monthly Pension Indexing
• Overview of Health, Dental, Life and additional
  benefits

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Types of Pension Plans

• Defined Benefit Plans (DB)
• Benefit is defined by a formula
• Pension at retirement is always known
• Most often the employer assumes the investment
  risks / rewards
• Defined Contribution Plans (DC)
• Contributions are defined by a formula
• Pension at retirement is unknown
• Most often the employee assumes the investment
  risks / rewards
• Hybrid Plan a combination of DB and DC
• Attempts to provide the best of both worlds

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Faculty Pension Plan

• Hybrid Pension Two Components
• Money Purchase (MPP) (Defined Contribution)
• AND
• Minimum Guarantee (MGP) (Defined Benefit)

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Faculty Pension Plan

• Money Purchase (Defined Contribution)
• 6 Member Contribution PLUS 6 University
  Contribution credited to individual member
  accounts along with fund rate of return
• Money Purchase Pension (MPP), payable monthly at
  retirement
• MPP Total MPC Account at Retirement
• Actuarial Annuity Factor
• Actuarial assumptions include mortality,
  retirement age, and spousal age.

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Faculty Pension Plan

• Minimum Guarantee (Defined Benefit)
• 1.5 of Best Average Earnings (BAE) up to Final
  Average YMPE (FYMPE)
• PLUS
• 2 of BAE above FYMPE
• Multiplied by
• Years (and part years) of Pensionable Service in
  the plan

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Plan Definitions

• BAE 12 X average of Members monthly earnings in
  the 48 months of highest earnings, (not
  necessarily consecutive) prior to retirement.
• Earnings Members basic nominal salary,
  excludes overload, allowances, bonuses or
  stipends, intersessions, etc.
• YMPE Years Maximum Pensionable Earnings in
  effect under the Canada Pension Plan.
• (2006 42,100) (2005 41,100) (2004
  40,500) (2003 39,900)
• FYMPE Average of YMPE during same period used
  to determine your BAE.

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Life as an Active Member

• Contributions 6 of nominal salary, with
  matching University contribution, subject to CCRA
  contribution limits. This includes nominal
  salary paid in the form of a Research Grant.
  Special rules for certain types of leaves such as
  sabbaticals, education leaves.
• Once an enrolled active member you may not opt
  out.
• Pensionable earnings, service and contributions
  captured monthly
• Immediate Vesting ownership of pension benefits
• Pension Adjustment T4 - deemed value of one
  year plan participation reduces personal RRSP
  room
• Annual Pension Statement within 6 months of
  plan year end
• Plan Year runs from July 1st to June 30th of each
  year

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Faculty Pension Plan Joining the Plan

• Full Time, Permanent Faculty
• Compulsory membership coincident with or next
  following Employment Date.
• Limited Term Appointments
• Voluntary participation coincident with or next
  following Employment Date.
• Sessional Instructors and Part Time Employees
• Voluntary participation coincident with or next
  following the completion of 24 months of
  Continuous Service provided you have
• (1) earned at least 35 of the CPP Years
  Maximum Pensionable Earnings or
• (2) worked at least 700 hours
• in each of the two (2) immediately preceding
  calendar years.

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Faculty Pension Plan Retirement

• Normal Retirement Date - July 1st following
  the last day of the contract year in which the
  member attains age 65
• - minimum age 65 to
  receive an unreduced pension
• Faculty hired after September 1, 1970 retire on
  the June 30th following the 65th birthday
• Faculty hired prior to September 1, 1970 retire
  on the August 31st following the 65th birthday
• Article 4704 of the Collective Agreement
  
• Early Retirement Date - anytime after age
  55
• - MPP pension is account balance
  annuity - MGP
  subject to actuarial reduction
• - subject to University approval

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Example of Annual Pension Payable

• Date of retirement September 1, 206
• Pensionable Service 35 years
• Best average earnings 90,000
• Final average YMPE 40,900
• MPC Account Balance 500,000
• Actuarial annuity factor 10.2203
• MPP 500,000/10.2203 48,922.24 per
  year
• MGP 35 x 0.015 x 40,900 0.02 x
  (90,000 - 40,900)
  55,842.50 per year
• Basic Benefit payable at retirement 55,842.50
  per year

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Faculty Pension Plan Survivor Options

• Death while active Greater of MPP account or
  MGP value
• Lump sum or Spousal Monthly Pension
• Death after Retirement based on option chosen
  at retirement
• If single at retirement or with spousal waiver
• Life Only, Life 5, 10 or 15
• If legal spouse at retirement or no spousal
  waiver on file
• Joint and Survivor 60, 66 2/3(Guar 5), 75 or 100
• Basic pension reduced 10 to 20 to provide
  spousal benefit
• Spouse and member can waive 60 option
• In ALL cases, options are permanent on 1st date
  of retirement

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Faculty Pension Plan Terminating before
Retirement

• Termination Benefit is the Greater of
• Money Purchase Component Account balance to-date
• Commuted value of Minimum Guaranteed Pension
  earned to-date
• Transfer Options
• Transfer termination benefit to a locked-in
  vehicle if employed gt 24 months
• Transfer termination benefit to a non locked-in
  vehicle if employed lt 24 months
• Leave benefit in plan for deferred pension at a
  future retirement date
• Transfer to a new employer, if allowed
• At Retirement - In Lieu of Pension, Members MAY
  transfer entitlements from plan
• Considered a termination, not a retirement
• Forfeit Minimum Guarantee Pension, lifetime
  pension indexing rights
• Higher investment fees, potentially greater
  investment risk to member
• Forfeit rights to Benefits, Tuition Remission,
  H.K. memberships etc.
• Forfeit future Surplus sharing

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Past Service Pension Adjustments

• What are they?
• Adjustments most often created by retroactive
  pension plan improvements
• Example MGP formula change from 1.45 / 2 to
  1.5 / 2
• University must calculate value of retroactive
  improvement and
• report this to Canada Customs and Revenue
  Agency (T215)
• Further reduces personal RRSP room and sometimes
  forces
• RRSP withdrawals

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Faculty Pension Plan Indexing Monthly Pension

• Both the MPP and MGP adjusted every July 1
• MPP adjusted by the fund rate of return in excess
  of 6 and an additional adjustment for mortality
  experience can increase or decrease
• MGP increase based on the increase in the
  Consumer Price Index
• After the MPP and MGP have been adjusted (plus or
  minus), we compare the two, the larger amount
  becomes the new pension payable starting at July
  1st
• Indexing rights passes to those with a Survivor
  pension

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Ontario Health Insurance Coverage (O.H.I.P.)

• All medically necessary insured services provided
  by physicians.
• Hospitalization, surgeries, emergencies
• Some dental services done in hospital
• Eye exams for persons under age20 and over age 65
  once per year.
• Services provided for certain other Health Care
  providers
• Limitations apply to all the above, and are
  intended as a broad example of Ministry of Health
  and Long Term Care funded services. More details
  can be obtained from the ministry office.

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Ontario Health Insurance Coverage (O.H.I.P.)

• Eligibility Criteria
• Canadian citizen, permanent resident or landed
  immigrant status
• OR have submitted Application for Permanent
  Residence or Application for Landing (medical
  approvals required)
• OR are Foreign worker with valid work permit or
  employment authorization for a named Canadian
  employer located in Ontario, valid for minimum of
  six months.
• OR are Spouse, same sex parter or dependent child
  (under age 19) of an eligible foreign worker
  (work permit for at least three consecutive years
  required).
• AND
• You make your permanent and principal home in
  Ontario
• AND you are in Ontario for at least 153 days of
  the first 183 days immediately following the date
  you establish residency in Ontario
• AND you are in Ontario for at least 153 days in
  any 12-month period

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Ontario Health Insurance Coverage (O.H.I.P.)

• Three month waiting period
• Reciprocal agreements from other Canadian
  provinces will cover the waiting period. You
  must advise both provincial health insurance
  agencies. Time restrictions apply.
• Apply without delay at 400 City Hall Square in
  Windsor.
• Must show valid Work Permit, Social Insurance
  Number and another document showing proof
  residency has been established in Ontario.
• Consult http//www.health.gov.on.ca for the full
  eligibility requirements, application process and
  coverage details

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Green Shield Replacement Health Insurance Coverage

• Temporary coverage
• MUST enroll as a condition of continuing
  appointment
• Mirrors the O.H.I.P. coverage
• Provides coverage during the 3 month waiting
  period
• Provides coverage for those not eligible for
  O.H.I.P. who are living in Ontario with a valid
  work permit of 6months or more
• Must be establishing residency in Ontario
• Not applicable for those living in the U.S.A. or
  outside Ontario
• First 3 months University paid for faculty
  appointments
• Employee paid if coverage extends past three
  months
• Consult Human Resources for full details and
  application form

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Green Shield Replacement Health Insurance Coverage

• Premiums
• July and August, 2006
• Single 44.10 per month
• Couple 81.00 per month
• Family 99.90 per month
• Effective September 1, 2006
• Single 92.61 per month
• Couple 180.63 per month
• Family 231.93 per month

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Faculty Plan Health Insurance Overview

• Benefits are effective with your date of
  employment.
• Green Shield provides single or family coverage.
• Coverage includes
• Drugs
• Semi-private hospitalization
• Extended health services
• Out of Province/Country coverage referral /
  emergency
• Vision
• Audio
• Health benefit premiums are paid by the
  University
• Subject to 10 Single / 20 Family annual
  deductible
• Web based subscriber online access
  www.greenshield.ca

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Faculty Plan Dental Insurance Overview

• Benefits are effective with your date of
  employment.
• Green Shield provides single or family coverage.
• Coverage includes
• 80 coverage for Basic Comprehensive Services
• 80 coverage for Major Restorative Services
• 50 for Orthodontic Services - 3,000 individual
  lifetime maximum
• Basic services cover recalls once every 9 months
• Dental services may be subject to limitations
• Dental benefit premiums are paid by the University

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Faculty Plan Group Insurance Overview

• Benefits are effective with your date of
  employment.
• Short Term Disability program (Employer Insured)
• Provides 105 days fully paid
• Long Term Disability insured by Great West Life
• Provides pro-rated benefit to a maximum of
  10,000 monthly, indexed
• LTD premium is Employee paid LTD benefit is Non
  Taxable
• Basic Life Insurance (Sun Life) A.D.D. (Chubb)
• Insurance benefit of three (3) times annual
  salary, rounded to the next highest 1,000 to a
  maximum of 350,000
• University paid Premiums
• Optional Dependent Life and A.D.D. available
• Employee paid Premiums

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Faculty Plan Additional Faculty Benefits

• Benefits are effective with your date of
  employment.
• Tuition Remission (taxable benefit)
• Full Time Faculty , their dependents and spouse
  eligible for free tuition.
• Sessional Instructors entitled to one tuition
  credit course per year in a year the Instructor
  teaches one (1) or more courses.
• Some limitations apply to this benefit. Contact
  Human Resources.
• St. Denis Centre Fitness Facility (non taxable
  benefit)
• Full Time Faculty, their dependents and spouse
  entitled to basic membership.
• Sessional Instructors are provided with
  membership during the semesters in which they are
  teaching.
• Some limitations apply to this benefit. Does not
  include access to the Forge. Contact the St.
  Denis Centre for more information.

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• Office of Pensions, Benefits and HR Systems
• Department of Human Resources 2nd floor
  Chrysler Hall Tower
• Rita LaCivita Executive Director of Human
  Resources - ext. 5007
• Cheryl Paglione Associate Director of Human
  Resources - Pensions,
  Benefits and HR Systems - ext. 2014
• Tom Puskas Manager of Pensions, Benefits and HR
  Systems ext. 2048
• Melissa Simas Pension, Benefits and Records
  Administrator Faculty,
  Librarians, Ancillary Academic
  Staff ext. 2090
• Visit our website at www.uwindsor.ca/hr
• Faculty Association
• Pension Benefits

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Faculty Orientation Pensions and Benefits

• Thank You!
• Questions?