FSRA issues final guidance on missing pension plan members

Ontario’s pension plan administrators and plan members share the responsibility of maintaining current contact information, according to the Financial Services Regulatory Authority of Ontario’s final guidance on missing plan members.

It recommended administrators maintain a records management system and retention schedules that support long-term administration of the pension plan and to exercise care and diligence in preserving accurate member data as the plan evolves due to redesign, restructuring and transfers. However, individual plan members must also be involved in the process.

Read: PIAC comments on FSRA’s plan for missing plan members

“Pension plan members have responsibilities, including a primary role to ensure that administrators have accurate and relevant personal information, including contact information,” the guidance said. “Members should notify their pension plan administrator whenever their mailing address, email address, name, beneficiary or marital status changes.”

The guidance included similar recommendations for multi-employer pension plans, where collection of member data is often the responsibility of participating employers or unions. It also advised administrators of multi-jurisdictional plans to be aware of the specific requirements that each jurisdiction may have, such as the ability to send plan assets related to missing members in one jurisdiction to an unclaimed-property office located in another region.

When searching for missing plan members, the guidance advised administrators to start as soon as possible and to prioritize factors such as the likelihood of the search’s success and the length of time the member has been missing, balanced with cost estimates and the value of the pension.

Read: How Canadian legislation is moving to solve issue of missing pension members

“The administrator should consider the impact of search efforts on the plan and membership as a whole, balanced with consideration of the interests of an individual missing member or small groups of missing members.”

In the event of a plan windup, the FSRA reiterated that an administrator’s duties continue until all entitlements are settled and as a result the administrator may defer the windup or delay settlement while searching for missing members. However, for missing members with locked-in pension benefits, administrators could potentially transfer these members to a different pension plan or a bulk annuity.

The FSRA also said a waiver of the requirement to provide biennial statements to former and retired members who are considered missing will only be available to plan administrators who carry out appropriate search activities in fulfillment of their fiduciary duty, such as attempting to obtain a member’s current mailing address.

Read: Ontario pension bill includes changes to e-communications, missing members