Canadian HR Reporter

F E A T U R E S 22 www.hrreporter.com P E N S I O N S FOCUSING ON SUSTAINABLE SAVINGS Looking to provide employees with secure and valuable defined benefit pension benefits, Torstar, SHARE and the United Way of Greater Toronto decided to try out a new type of plan, says Derek Dobson of the CAAT Pension Plan RESEARCH shows that Canadians want and are willing to c o n t r i b u t e t o a c h i e v e s e c u r e , p r e d i c t a b l e , l i f e t i m e r e t i r e m e n t income. Likewise, employees, unions and employers are increasingly looking for better and more secure pension options that have the best features of large defined benefit (DB) pensions without the costs and risks of traditional single employer plans. Valuable and secure DB plans have been shown to have a significant and positive impact on employee attraction, retention and engagement. b y a m i x o f d e fi n e d b e n e fi t , de fined contribution and group RRSP programs. Torstar was searching for ways to m a n a g e p e n s i o n b a l a n c e s h e e t volatility, while still providing secure and valuable defined pension benefits for all employees. So, in 2018, the 3,400 Torstar defined benefit (DB) members voted 97 per cent in favour of merging with the CAAT Plan. CAAT's DBplus offers organizations the flexibility to select a contribution rate that ranges from five per cent to nine per cent, matched by the employer. The higher the contribution rate, the better the pension. CAAT also allows groups that currently have no or low contributions to gradually phase in to their ultimate desired fixed contribution rate. The DBplus pension is paid for life a n d i n c l u d e s f e a t u r e s s u c h a s conditional inflation enhancements in retirement, subsidized early retirement a n d n o - c o s t s u r v i v o r b e n e fi t s . Members also have the option to consolidate their retirement savings by purchasing additional pension in DBplus where permitted. "We were attracted to the CAAT plan by the opportunity to replace fluctuating and sometimes unpredictable funding requirements under our plans by the Canadians who belong to these plans report significantly lower financial planning stress and retire on a more predictable basis allowing employers to plan better. Employers also benefit from lower stress in the workplace, which leads to lower benefit costs and absenteeism. Torstar Corporation Media conglomerate Torstar Corporation, a publicly traded company, and its union partners place high value on a su s ta in a b le p en sio n b en e fit fo r employees. Its workforce was covered PENSIONS POPULAR IN CANADA 3.2 million Number of women with a registered pension plan (RPP) in 2017 1.2 million Number of workers with a defined contribution (DC) pension plan in 2017, up by 3.5% from 2016 3.1 million Number of men with an RPP in 2017 67% Percentage of RPP members with a DB plan in 2017 4.2 million Number of paid workers covered by a defined benefit (DB) pension plan in 2017, up 0.7% from 2016 18% Percentage of RPP members with a DC plan in 2017 "This has improved the pension we offer, helping ensure long-term, sustainable, secure retirement savings." Rahima Mamdani, United Way of Greater Toronto much more predictable funding profile associated with DBplus," says Lorenzo DeMarchi, executive vice president and CFO of Torstar in Toronto. Torstar employees are a mix of non- bargaining and bargaining staff represented by two unions — Unifor and Teamsters. In all, there are about 5,400 To r s t a r e m p l o y e e s , a n d t h e i r contribution rates for DBplus are at nine per cent for former DB members and five per cent for all other employees. The pension merger with the CAAT Pension Plan allowed Torstar to exit the pension risk management business and eliminate defined benefit pension volatility on its balance sheet, thereby providing an overall benefit to its business. "Being part of a plan that has significantly greater scale and is managed by a team of people that are solely focused on providing defined Source: Statistics Canada

• Cover