Change to the Québec construction industry pension plan starting December 31, 2017

On December 31, 2017, a change to the pension plan came into effect concerning benefits payable upon termination of membership for participants who are not eligible to retire. It provides that benefits accumulated in the General Account (hours worked before 2005) are paid out according to the plan's solvency  ratio* without exceeding 100%. However, the change has no impact on contributions accumulated in the Complementary  Account. For example, the plan's solvency ratio* on December 31, 2017 is 86.34%.

Are you affected?

You are not affected by this change if you are in one of the following situations:

  • You are a retiree (full or partial retirement) or a surviving spouse
  • You have no hours worked before 2005
  • You are at least 55 years of age
  • You want to leave your benefits in the plan until your retirement

In all other cases, it is possible that you will be affected by the change.

Why was this change made?

The Assemblée nationale du Québec adopted the Act to Amend the Supplemental Pension Plans Act mainly with respect to the funding of defined benefit pension plans (Bill 29). As its name indicates, Bill 29 changes how defined benefit pension plans in the private sector are funded. This statute, which came into effect on January 1, 2016, modifies certain rules concerning the payment of money accumulated by participants in certain specific situations. Following adoption of the statute, the Construction Industry  Social Benefits Committee adopted a change to the plan that came into effect on December 31, 2017.

* The solvency ratio is the measure of the financial capacity of the plan to honour its commitments to participants if the plan had to end on the date of evaluation. In short, this percentage reflects the health of a pension plan at a specific moment. Depending on the returns on investments and the interest rates, this percentage fluctuates from year to year. The solvency ratio used for the purposes of transfer or payment may not exceed 100%.