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Statutes of Newfoundland 1998


CHAPTER 26

AN ACT TO AMEND THE TEACHERSí
PENSIONS ACT

(Assented to December 15, 1998)

Analysis

1. S.2 Amdt.
Interpretation

2. S.6 Amdt.
Contributions by
teachers

3. S.8 Amdt.
Government contributions

4. S.8.1 Added
Government payments

5. S.9 Amdt.
Repayment of contributions

6. S.12 Amdt.
Purchase of service with
related plans

7. Ss.13 & 13.1 R&S
Purchase of leave
without pay

8. S.14 Rep.
Purchase of other service

9. S.15 Amdt.
Payment of contributions
for prior service

10. S.15.1 Added
Period of prior substitute
teaching service

11. S.16 Amdt.
Reciprocity

12. S.19 Amdt.
Disability retirement

13. S.20 Amdt.
Early retirement

14. S.22 Amdt.
Calculation of pension

15. S.25 Amdt.
Re-employment after normal
retirement age

16. S.26 Amdt.
Survivor benefits

17. S.27 Amdt.
Designated beneficiary

18. S.28 Amdt.
Estate provision

19. S.29 Amdt.
When pensions payable

20. S.31 R&S
Pension not assignable

21. S.40 Amdt.
Conflict

22. S.41 R&S
Plan protection

23. S.43 R&S
Income Tax Act (Canada)
requirements

24. S.45 Amdt.
Teachers with greater than 30 years

25. S.46 Rep.
Teachersí training years

26. S.47 Rep.
Teachersí ancillary pension plan

27. Commencement

 

Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:


SN1991 c17
as amended

1. Paragraph 2(1)(b) of the Teachersí Pensions Act is repealed.

2. Subsections 6(2) and (3) of the Act are repealed and the following substituted:

(2) There shall be deducted from the salary of every teacher to whom the pension plan applies

(a) 8.5% of that salary; and

(b) other additional amounts that may be prescribed.

(3) Teacher contributions shall not exceed the contribution amounts permitted under the Income Tax Act (Canada).

(4) Where, as a result of an administrative error or oversight, contributions have been deducted from the salary of a teacher in excess of the amounts set out in subsection (2) those contributions shall be returned to the teacher together with interest at the prescribed rate.

3. (1) Subsection 8(1) of the Act is amended by deleting the word "The" at the beginning of the section and substituting the phrase "Subject to the requirements of the Income Tax Act (Canada), the".

(2) Subsection 8(2) of the Act is repealed and the following substituted:

(2) Where, as a result of an administrative error or oversight government contributions are made in excess of those required under section 6, those contributions shall be refunded to the government with interest at the prescribed rate.

4. The Act is amended by adding immediately after section 8 the following:

Government payments

8.1 (1) The government of the province shall pay $815 million to the Teachersí Pension Plan.

(2) Payment under subsection (1) shall be made as follows in the amount of

(a) $166 million, on or before September 1, 1998;

(b) $166 million, on or before September 1, 1999; and

(c) $76 million on or before September 1 in each year after 1999 until a total of $815 million, including interest, has been paid.

(3) Interest shall accrue on the outstanding balance described under subsection (2) at the rate of 8% a year, compounded annually.

5. Subsection 9(2) of the Act is repealed.

6. Subsection 12(3) of the Act is repealed and the following substituted:

(3) Where a teacher who was employed on a full time basis

(a) is an employee of an employer to which the Public Service Pensions Act, 1991 applies; and

(b) the service was performed before that Act was made applicable to the employer,

the teacher may elect to purchase all or a part of that service and pay those contributions that may be prescribed, provided that he or she was not covered by a pension plan of the employer during that period.

7. Sections 13 and 13.1 of the Act are repealed and the following substituted:

Purchase of leave without pay

13. (1) A teacher who is on an authorized leave of absence without pay may have the period of that leave of absence credited as pensionable service provided that he or she makes the contributions required under section 6.

(2) The contributions made under subsection (1) and the calculation of a pension under section 22 shall be based on the salary that the teacher was earning immediately before the commencement of his or her authorized leave of absence without pay provided that the teacher elects

(a) within 180 days after returning from that authorized leave; or

(b) before termination of the employment

to purchase the period of absence, whichever is less.

(3) All matching contributions required under subsection (2) shall be paid by the government of the province.

(4) Notwithstanding subsections (2), (6) and (7) an authorized leave of absence without pay may be purchased after the expiration period at a cost that may be determined by the minister and no matching contributions shall be paid by the government of the province.

(5) The cost referred to in subsection (4) shall be the greater of the actuarial cost and the employee contributions required under section 6.

(6) Upon the commencement of this section, a teacher with periods of authorized leave of absence without pay who did not purchase that service before the commencement of this section shall have 180 days from the commencement of this section to purchase those periods of leave of absence without pay as pensionable service in accordance with subsections (1) and (2).

(7) The contributions referred to in subsection (6) shall be matched by the government of the province.

(8) A teacher is not eligible to be credited with pensionable service under this section if the teacher is eligible to be credited with that pensionable service under another section of this Act.

8. Section 14 of the Act is repealed.

9. Section 15 of the Act is amended by deleting the comma after the number "12" and deleting the numbers, comma and word "13, 13.1 and 14" and substituting the word and number "and 13".

10. The Act is amended by adding the following immediately after section 15:

Period of prior substitute teaching service

15.1 For the purchase of prior substitute teaching service under section 11, where the teacher did not contribute to the Substitute Teachersí Pension Plan, the time period for payment for that service by instalment shall not exceed a period which is the shorter of

(a ) twice the period of pensionable service; or

(b) the period from the date of election to purchase the service to a date immediately preceding the date on which the teacher retires.

11. Subsection 16(3) of the Act is repealed.

12. Subsection 19(1) of the Act is amended by deleting the phrase "unable to perform his or her duties efficiently owing to an incapacity which" and substituting the phrase "suffering from a physical or mental impairment that prevents the teacher from performing the duties of the employment in which he or she was engaged before the commencement of the impairment provided that the impairment".

13. Section 20 of the Act is amended by adding immediately after subsection (2) the following:

(3) Regardless of age, a teacher may retire early where that teacher has accrued not less than

(a) 30 years of worked service; or

(b) 29 years of worked service and 30 years of pensionable service.

(4) For the purpose of paragraph (3)(b), a teacher under the age of 55 shall have pension benefits as calculated under section 22 reduced in accordance with the following table:

 

 

Number of months to age 55
12 months or less
13 months but less than
49months
49 months or more

 

Reduction factor
1/4 of 1% per month
3% plus 1/3 of 1% for each month
in excess of 12
15%

(5) The reduction of pension benefits referred to in subsection (4) shall cease when the teacher reaches the age of 55.

(6) For the purpose of this section, "worked service" means pensionable service except a teacherís university training years for which the teacher has been credited under the plan.

14. (1) Subsection 22(2) of the Act is repealed and the following substituted:

(2) Commencing on September 1, 1998, teachers may elect to retire during the school year only if they have completely accumulated the required number of years of pensionable service necessary for eligibility for a pension.

(2.1) At the end of a school year, teachers who require 5/10 or less of a year of pensionable service in order to qualify for a pension, may elect to retire but that benefit shall be determined by the number of years and tenths of years of pensionable service accumulated to the date of retirement.

(2) Section 22 of the Act is amended by adding immediately after subsection (7) the following:

(8) Commencing on September 1, 1998, a pension awarded under subsection (1) shall be reduced for all pensionable service, including that accruing before September 1, 1998, by the product of 6/10 of 1% of the teachersí average annual salary as calculated under subsection (1) multiplied by the number of months of pensionable service completed after March 31, 1967, divided by 12 and not exceeding 35 years.

(9) For the purpose of subsection (8), a teachersí average annual salary may not exceed the average of the teachersí yearsí maximum pensionable earnings under the Canada Pension Plan in the year the teacher has retired and in the 2 years immediately before the teacherís year of retirement.

(10) A pension of a teacher shall be reduced under subsection (8) on the earlier of the

(a) first of the month following the month in which the teacher reaches age 65; or

(b) effective date of the payment of benefits to the teacher under the Canada Pension Plan.

(11) Where the effective date of the payment of a benefit referred to in subsection (10) is before age 65, the amount of the reduction as calculated under subsection (8) shall be reduced by.5% for each month, to a maximum of 30% where the effective date established under paragraph (10)(b) is before the date established under paragraph (10)(a).

15. Subsection 25(4) of the Act is repealed.

16. Section 26 of the Act is amended by adding immediately after subsection (1) the following:

(1.1) Notwithstanding subsection (1), a survivor benefit equal to 60% of

(a) the pension paid to a deceased pensioner who retired on or after September 1, 1998 as if that pensioner were subject to the reduction under subsection 22(8); or

(b) the pension entitlement of a teacher who dies in service on or after September 1, 1998, reduced in accordance with subsection 22(8) as if that teacher were 65 years of age on the date of his or her death; or

(c) the pension entitlement a deferred pensioner who dies on or after September 1, 1998 would have received had he or she reached his or her normal retirement age at the time of his or her death, reduced in accordance with subsection 22(8) as if that deferred pensioner were 65 years of age on his or her date of death,

shall be paid to the surviving spouse for life, commencing on the first day of the month following the month in which the death of the pensioner, teacher or deferred pensioner occurs.

17. (1) Subsection 27(1) of the Act is amended by adding immediately after the word "beneficiary" the words "who is a dependent and".

(2) Section 27 of the Act is amended by adding immediately after subsection (4) the following:

(5) For the purpose of this section a dependent of a teacher at the time of the teacherís death means a parent, grandparent, brother, sister or grandchild of the teacher who, at that time, is both dependent on the teacher for support and is

(a) under 18 years of age and will not attain the age of 18 years in the calendar year of the death of the teacher;

(b) under the age of 24 years and is in full time attendance at an educational institution; or

(c) dependent on the teacher by reason of mental or physical infirmity.

18. Section 28 of the Act is amended by deleting the word "twice".

19. Section 29 of the Act is amended by adding immediately after subsection (2) the following:

(3) Pension payments shall be equal and periodic.

20. Section 31 of the Act is repealed and the following substituted:

Pension not assignable

31. A pension may not be assigned, surrendered, charged, anticipated or given as security except as provided under the Pension Benefits Act, 1997.

21. Section 40 of the Act is amended by adding immediately after the words "another Act" the words "of the province".

22. Section 41 of the Act is repealed and the following substituted:

Plan protection

41. This Act shall apply to all benefits accrued under the former Act.

23. Section 43 of the Act is repealed and the following substituted:

Income Tax Act (Canada) requirements

43. For the purpose of the Income Tax Act (Canada)

(a) the pension adjustment factor as defined under the Income Tax Act (Canada) shall not exceed the lesser of

(i) the money purchase limit for the year, or

(ii) 18% of the memberís compensation from the employer for the year;

(b) contributions under sections 6 and 8 shall be made under the recommendation of an actuary; and

(c) the minister is the administrator of the pension plan.

24. Subsection 45(3) of the Act is repealed.

25. Section 46 of the Act is repealed.

26. Section 47 of the Act is repealed.

Commencement

27. This Act is considered to have come into force on September 1, 1998.

©Earl G. Tucker, Queen's Printer