I reach my rule of 80 date prior to my 55th birthday. Why does my Pension Statement show the date I reach the rule of 80 as the same date as my 55th birthday?
Members of the MTS Pension Plan are not eligible to collect an unreduced pension until they are age 55. You may, however, start to collect your pension prior to your 55 birthday, but the pension you receive will be actuarially reduced.
If I do not have the rule of 80 can I still retire at age 55?
Yes. However, you must have at least 2 years of service and your pension will be actuarially reduced. If, however, you have at least 10 years of continuous service at age 55, you would be eligible for a reduced pension with a bridging benefit paid until you are age 65, versus an actuarially reduced pension.
How do you determine when I reach the rule of 80?
Generally, to determine your rule of 80 we use your Continuity of Service Date (COS), which is the date you started with MTS, to determine how long you have worked for the company and add this number to your age.
How does banking 50 days of vacation affect my pension?
Banked vacation credits enhance pension benefits. The maximum 50 days vacation credits can increase a monthly pension by approximately 4%. This is because the 50 days are added to your income for purposes of determining your best 5 years of earnings. And the higher your best 5 years of earnings are the higher your pension benefit is. When you retire, the 50 days of vacation is paid out (net of deductions) to you. Specifically, MTS will deduct 5.1% from your vacation pay if your earnings are under the CPP maximum and 7% if they exceed the CPP maximum. This is your normal pension contribution. Other deductions taken from the vacation pay are income tax, CPP if you are under the maximum contributions and EI if you have not contributed the maximum for the calendar year. After the statutory deductions are taken, the rest of the money is yours!
Should the credited service commencement date be the same as my Net Credited Service (NCS) date?
These two dates do not have to be the same. The credited service commencement date is the date you started to contribute into the pension plan. The net credited service (NCS) date is the date established by MTS for certain benefit entitlements such as vacation or sick days. You may, however, have some bridged time that MTS has given you credit for in your NCS date that does not affect your credited service commencement date for pension purposes.
Can I buyback pensionable service for prior employment that I bridged with MTS?
Although MTS allows you to bridge your service, if you withdrew your pension funds out of the Pension Plan when you terminated employment you cannot reinstate this prior employment for pension purposes unless you had less than two years of employment when you terminated and did not exceed the time allowed by the Pension Plan. When you take your funds out of the Pension Plan, the service prior to the termination is gone and cannot be combined with any new service when you become re-employed with the company.
Is my superannuation pension from the Civil Service Superannuation Board and my pension from the MTS Pension Plan the same pension?
Prior to the privatization of MTS in January 1997, we were part of the Provincial government and were members of the Civil Service Superannuation Fund (Superannuation). Upon privatization we could no longer be members of the Civil Service Superannuation Fund as we were no longer part of the Provincial Government. At that point all MTS employees became members of the MTS Pension Plan. All prior service and earnings were transferred from the Civil Service Superannuation Fund to the MTS Pension Plan, As a result, MTS employees no longer belong to the Superannuation Fund.
When I terminate employment does MTS match my pension contributions?
If you terminate employment with less than 2 years of service, you receive a refund of your contributions plus interest. If you terminate employment after 2 years of service, you are a vested member of the MTS Pension Plan and as such can leave your funds in the MTS Pension Plan until you wish to retire or, you can transfer the value of your pension to a locked-in RRSP. The value of that transfer will include your contributions as well as an amount from the company. For service after 1985, no more than 50% of the value of the pension transfer can come from your contributions plus interest.
My husband and I have recently separated. Our separation agreement states how we are to divide our family assets, including the pension benefits. Do I still have to contact MTS regarding the pension?
Yes. Members who experience a marriage separation must have the applicable forms, regarding their pension benefits from the MTS Pension Plan, completed and returned to MTS. If the forms are not on file, MTS cannot recognize the pension split or waiver of pension benefits. This can delay a member’s pension benefit entitlement in the event of a retirement or termination of employment.
In the MTS pension formula it talks about YMPE. How does CPP contributions and earnings tie into the MTS Pension Plan?
YMPE is the yearly maximum pensionable earnings for the Canada Pension Plan (CPP). The Federal Government sets this maximum each year and this number then determines the maximum amount of CPP which you can contribute each year. (It is also used to determine the maximum benefit you can receive from the Canada Pension Plan.) CPP contributions are taken on all earnings paid to a employee. This includes overtime, sick vesting and bonuses. When an employee reaches this yearly maximum set out by the Federal Government, they stop contributing CPP for the remainder of that calendar year. The MTS Pension Plan uses the YMPE number to determine what contribution rate will be used for your contributions into the MTS Pension Plan. While your regular earnings are less than the YMPE, you contribute 5.1% of your regular earnings into the MTS Pension Plan. Regular earnings does not include bonuses, overtime or sick vesting. Once your regular earnings exceed the YMPE, you start contributing 7% of your regular earning into the MTS Pension Plan. Since CPP contributions are made on all types of earnings your Pension Plan contributions are only made on your regular earnings, you can reach your CPP maximum contributions and earnings before you reach the same maximum in earnings used to calculate your Pension Plan contributions.