Second

Session, 45th General Assembly

Elizabeth II, 2005

BILL 63

AN ACT TO AMEND THE MEMORIAL UNIVERSITY PENSIONS ACT

Received and Read the First Time ...................................................................................................

Second Reading .................................................................................................................................

Committee ............................................................................................................................................

Third Reading .....................................................................................................................................

Royal Assent ......................................................................................................................................

HONOURABLE

JOAN BURKE

Minister of Education

Ordered

to be printed by the Honourable House of Assembly

EXPLANATORY NOTES

Clause 1 of the Bill would amend

section 3 of the Memorial University

Pensions Act to bring new categories of employees, including part-time employees,

under the Act.

Clause 2 of the Bill would add a new

paragraph 5(b.1) to the Act. This would add employees referred to in the

amendment at clause 1 to the list of contributors to the Memorial University

Pension Fund.

Clause 3 of the Bill would repeal and

replace subsections 12(3) and (3.1) of the Act by removing a reference to the "board"

in subsection (3) and by adding employees referred to in clause 1 to subsection

(3.1) respecting contribution amounts.

Clause 4 of the Bill would repeal and

replace paragraph 15(1)(

b) of the Act respecting retirement due to disability

in order to add a reference to employees referred to in clause 2. This clause

would also repeal and replace subsection 15(8) to add to that subsection a

reference to employees referred to in clause 2 which allows for an extension of

employee periods of service.

Clause 5 of the Bill would repeal

subsection 18(4) of the Act to bring this subsection into agreement with

requirements of the Income Tax Act ( Canada ).

Clause 6 of the Bill would add the

proposed paragraph 19(1)(a.1) to the Act to add persons referred to at clause 1

and permit the inclusion of persons employed on a part-time basis to the provision

relating to periods of allowable pensionable service.

Clause 7 of the Bill would add

persons referred to in clause 1 to subsection 25(3) of the Act respecting the

employment of persons who have received a pension refund and returned to

employment with the university.

Clause 8 of the Bill would repeal and

replace

section 29.1 of the Act to more clearly outline the policy directives that

may, with the approval of the Minister of Finance, be made by the board of the

university to implement the provisions of the Act.

Clause 9 of the Bill would amend

subsection 29.2(1) of the Act to remove a reference to "the board"

with respect to the implementation of Minister of Finance directives on the

integration of the Act with the Canada Pension Plan.

Clause 10 of the Bill would repeal

and replace

section 34 of the Act respecting reciprocal agreements for pensions

with other employers. The language would then mirror that contained in other

provincial pension statutes such as the Public

Service Pensions Act, 1991 . This clause would also add a new

section 34.1

respecting the transfer of pensions from plans other than plans of the

government of the province. This latter amendment mirrors recent amendments to

the Public Service Pensions Act, 1991 ,

Teachers' Pensions Act and the Uniformed Services Pensions Act .

A BILL

AN ACT TO AMEND THE MEMORIAL UNIVERSITY

PENSIONS ACT

Analysis

S.3 Amdt.

Application of Act

S.5 Amdt.

Pension fund

S.12 Amdt.

Contributions to fund

S.15 Amdt.

Retirement

S.18 Amdt.

Amount of pension

S.19 Amdt.

Pensionable service

S.25 Amdt.

Refund

S.29.1 R&S

Policy directive

S.29.2 Amdt.

Integration with Canada Pension Plan

S.34 R&S

34. Reciprocal agreements

34.1 Transfer where no

agreement

Be it enacted by the Lieutenant-Governor and

House of Assembly in Legislative Session convened, as follows:

RSNL1990 M-8

as amended

1. Subsection 3(1) of the Memorial University Pensions Act is repealed and the following substituted:

Application of

Act

(1) This

Act applies to

(

a) a person appointed by the board employed

full-time for an indefinite term upon an annual salary paid wholly and directly

by the board;

(

b) a person employed full-time for an indefinite

term by the Memorial University Recreation Complex Inc.;

(

c) a person employed full-time for an indefinite

term by a related not-for-profit employer

whose operations and financial position are reported in the university's

consolidated financial statements and who is, upon the date of the coming into

force of this paragraph, a member of the pension plan or in receipt of a pension

benefit from the fund;

(

d) a person directed by the board to be included

in the pension plan under subsection 29.1(2); and

(

e) a person appointed by the board or by an

employer referred to in paragraph (

b) or (c), who is employed on a less than full-time

basis for an indefinite period as directed by the board and approved by the

minister.

(1) Section 5 of the Act is amended by adding

immediately after paragraph (

b) the following:

(b.1) contributions made by an employer referred to

in paragraphs 3(1)(

b) and (

c) of this Act;

(2) Paragraph 5(

d) of the Act is amended by adding

immediately after the figures "(b)", a comma and the figures "(b.1)".

3. (1) Subsections 12(3) and (3.1) of the Act

are repealed and the following substituted:

(3) There shall be deducted from the salary of

each employee and paid into the fund the contributions payable under this

section.

(3.1) The board and an employer referred to in

paragraphs 3(1)(

b) and (

c) shall contribute to the fund an amount equal to the

contributions paid by their employees under this

section and additional amounts

required to be paid by an employer under the Pension Benefits Act, 1997 and the rateable share of those

additional amounts shall be determined by the board.

(2) Subsection 12(5) of the Act is repealed.

4. (1) Paragraph 15(1)(

b) of the Act is

repealed and the following susbstituted:

(

b) if he or she is not participating in the long

term disability insurance plan of the university or a similar plan substituted

for it and is unable to perform his or her duties effectively owing to a

physical or mental incapacity medically certified to the satisfaction of the

board or an employer referred to in paragraphs 3(1)(

b) and (

c) and approved by

the board as likely to be permanent.

(2) Subsection 15(8) of the Act is repealed and

the following substituted:

(8) Notwithstanding subsection (7), the board or

an employer referred to in paragraphs 3(1)(

b) and (c), with the approval of the

board, may extend the period of service of an employee for not more than 3

years beyond normal retirement age and those additional years of service are

years of pensionable service.

5. Subsection 18(4) of the Act is repealed.

6. Paragraph 19(1)(

a) of the Act is repealed and the

following substituted:

(

a) the period served as an employee under this

Act;

(a.1) in the case of an employee referred to in

paragraph 3(1)(b), a period of eligible pensionable service credited under the

pension plan of the City of St. John's provided that funds sufficient to pay

the actuarial cost of service with the City of St. John's, as determined by the

actuary appointed by the board, are transferred directly to the fund or if

funds are not sufficient to pay the actuarial cost of that eligible pensionable

service, the period of eligible service that is the product of the total eligible

service with the City of St. John's times the ratio that the funds transferred

have to the actuarial cost of the eligible pensionable service;

(a.2) where an employee is not in full-time

employment, the proportionate period of pensionable service served determined

with reference to the ratio that the employee's part-time employment bears to full-time

employment as directed by the board;

7. Subsection 25(3) of the Act is repealed and the

following substituted:

(3) A person who has ceased to be an employee and

who has received a refund under subsection (1) may, if the person is

re-employed by the board or an employer referred to in paragraphs 3(1)(

b) and

(c), be credited with the prior pensionable service that the employee may elect

to purchase by paying an amount to be calculated in accordance with the terms

and conditions that may be prescribed.

Section 29.1 of the Act is repealed and the

following substituted:

Policy directive

29.1

(1) Subject

to the approval of the minister, the board may prescribe policy directives to

give effect to this Act including directives prescribing rates of interest,

employee may purchase service which shall be counted as pensionable service.

(2) Subject to the approval of the minister, the

board may prescribe by policy directive that

(

a) employees appointed by the board who are

employed full-time or part-time for a fixed term of employment on a salary paid

wholly and directly by the board; and

(

b) employees of an employer referred to in

paragraphs 3(1)(

b) and (

c) who are employed full-time or part-time for a fixed

term of employment,

be included in the pension plan.

(3) A directive prescribed under subsection

(2) an employer referred to in paragraph 3(1)(

b) or (

c) may be counted as pensionable

service under this Act and may provide for matters relating to the prior

service.

9. Subsection 29.2(1) of the Act is amended by

deleting the words "the board may deduct from the employees" and

substituting the words "there shall be deducted from the employees".

Section 34 of the Act is repealed and the

following substituted:

Reciprocal agreements

(1) The

board may, with the approval of the minister, enter into a reciprocal agreement

with

(

a) the province;

(

c) the government of another province of Canada ;

(

d) an agency of the province, the Government of

Canada or the government of another province of Canada ;

(

f) a company, corporation, institution or a legal

entity authorized to carry on business in Canada ;

and

(

g) another person approved by the board

to give effect to the purposes set out in

subsection (2) and to provide that payments be made into and out of the fund

under that agreement.

(2) Where an employee who was formerly employed by

a government, agency, institution or other person with whom there is a reciprocal

agreement under subsection (1), and that government, agency, institution or

other person has a pension plan in which the employee was formerly a member, that

employee may be credited with pensionable service under this Act that is the

whole or part of his or her years of pensionable service credited to him or her

under his or her former plan in accordance with that reciprocal agreement.

Transfer where no

agreement

34.1

(1) A

person who, before becoming an employee, made contributions to a pension plan

that is registered as a pension plan under the Income Tax Act (Canada), other than a pension plan

(

a) to which the Portability of Pensions Act applies; or

(

b) which is the subject of a reciprocal agreement

under

section 34,

may, upon becoming an employee, elect to

have that pensionable service transferred directly from the exporting pension

plan and credited as pensionable service under this Act.

(2) Subsection (1) shall apply only where the

employee has terminated his or her membership in the exporting pension plan and

has not received a termination benefit from the exporting pension plan.

(3) A period of pensionable service may be

transferred under subsection (1) provided that it is not already counted as

pensionable service under this Act.

(4) An election made under subsection (1) is

irrevocable.

(5) The pensionable service to be credited under

the pension plan shall be determined with reference to the actuarial cost of

the pensionable service at the date of the election under subsection (1) as calculated

by the actuary appointed by the board.

(6) Upon an election under subsection (1), the exporting

pension plan shall transfer to the fund a lump-sum amount that is the lesser of

(

a) the actuarial cost of the pensionable service

at the date of election; and

(

b) the value of the termination benefit to which

the employee is entitled.

(7) Where the lump-sum amount transferred under

subsection (6) is insufficient to finance the actuarial cost of the full period

of pensionable service that has been transferred under subsection (1), the employee

may elect

(

a) to pay the amount required to make up the

deficiency; or

(

b) to be credited with the proportionate period

of pensionable service which can be financed by the lump-sum amount.

(8) The amount of a deficiency shall be paid in

the prescribed manner.

(9) For the purpose of this section,

"actuarial cost" means the cost of service to be credited as

determined at the date of the election and calculated with reference to the

assumptions from the most recent actuarial valuation for funding purposes.

Earl G. Tucker, Queen's Printer