© Copyright 2006 Rogers Publishing Ltd. The following article first appeared in the February 2006 edition of BENEFITS CANADA magazine.
Fact Check
Hot off the assembly line: new pension and benefits legislation.
By Anna Sharratt

While you were working…
Over the last little while, there have been significant modifications in benefits and pension legislation across Canada. Employer-sponsored plans in a number of provinces are becoming subject to new social and tax measures, with Quebec being at the forefront of change. A sampling of new legislation that has, or will soon, kick in:


  • The Quebec Parental Insurance Plan provides for payment of enhanced benefits to eligible workers if a child is born or adopted on or after Jan. 1, 2006. It replaces maternity, parental or adoption benefits available to Quebec parents under Employment Insurance.
  • Five weeks of paternity benefits are now available to fathers at 70% of their earnings, if the birth has occurred on or after Jan. 1, 2006.
  • The deductible under the Prescription Drug Insurance Plan has been increased; there is a reimbursement of 71.5% after the monthly deductible of $11.90 per adult; and a 100% reimbursement after the monthly out-ofpocket maximum of $71.42 per adult. The premium has also been increased to up to $521 per adult per year.


  • The pre-retirement death benefit provision(minimum value equal to 100% of commuted value of benefits)has been amended to include service prior to Jan. 1, 1994.
  • The spousal waiver of the pre-retirement death benefit has been introduced(a spouse can waive a lifetime pension equal to 60% of the member’s early retirement pension).


  • Mandatory retirement will be prohibited as of Dec. 12, 2006(with exceptions).
  • Physiotherapy services are only available to residents over age 64 or under age 20 and residents of long-term care facilities.


  • As of Jan.1, 2006, the cap on assessable earnings has been removed.
  • Disability wage loss benefits will increase after 24 months from 80% to 90%.


  • It is anticipated that Alberta will soon announce changes to pension legislation, including a spousal waiver of the preretirement death benefit.


  • Contribution limits for money purchase registered pension plans and deferred profit sharing plans have increased to $19,000 and $9,500 respectively.
  • The maximum pension benefit per year of service under a defined benefit registered pension plan rose to $2,111.11.

Source: Mercer Human Resource Consulting’s Benefits Legislation in Canada 2006.