The Hourly Pension Plan and Salaried Pension Plan are defined benefit (DB) pension plans. With DB pension plans, the amount of benefit is defined in the pension plan text and determined by a formula which includes:

• Pensionable Service
  • number of years and partial years since you became a member of the pension plan
  • this is directly impacted by your hours worked and any leaves of absence that you may take and during which you do not make pension contributions
• Best Average Salary/Earnings
  • the average of your highest months of Regular Annual Salary/Earnings while you were a member of the pension plan
  • the number of months used in the formula vary by employee group/pension plan
• Average Year’s Maximum Pensionable Earnings (AYMPE) – maximum figure set each calendar year by the Canadian government in accordance with average wage levels
  • average of the YMPE’s in effect for the same months used in the Best Average Salary/Earnings
  • the number of months used in the formula vary by employee group/pension plan

The formula to calculate your pension benefit varies by employee group and pension plan. Please refer to your employee group’s Pension Highlights documents located under the Hourly Pension Plan and Salaried Pension Plan tabs.

When you reduce your hours of work, it impacts your pension in the following ways:

• Your “Pensionable Service”[1] for the purpose of calculating the amount of your pension will decrease based on your reduced hours (Ex: Full-time workload would receive 1 year of service. If your workload is reduced to 50% of the full-time workload, then you would receive 0.5 years of Pensionable Service during the relevant period)
• If your rate of pay has not decreased, then there will be no impact to your Best Average Salary[2] since your full-time equivalent salary is used in the calculation of your Best Average Salary. Also, the calculation of Best Average Salary takes into account your highest 48 or 60 months (depending on employee group) of full-time equivalent annual salary. If you have already logged 48 or 60 months of Pensionable Service (as applicable, depending on your employee group), then any decrease in salary at the end of your employment will not be taken into account in any event.
• Contributions are calculated on the basis of full-time equivalent salary then pro-rated according to the hours worked, therefore contributions will decrease with the reduced hours.

Note that reducing your hours of work does not affect your “Pensionable Service” for the purpose of determining your “Special Retirement Date”.[3]  For the sole purpose of determining a Member’s Special Retirement Date, the “Pensionable Service” of a Member while he/she is a part-time Employee is determined without proration based on hours worked.

[1] Under the Hourly Pension Plan, the term “Credited Service” is used, rather than “Pensionable Service”.

[2] Under the Hourly Pension Plan, the term “Best Average Earnings” is used, rather than “Best Average Salary”.

[3] Under the Hourly Pension Plan, the term “Special Early Retirement Date” is used, rather than “Special Retirement Date”.

Annual Pension Amount Earned in the Plan

Members will receive annual pension statements in December each year, which will provide information about your accrued pension amount as of the Annual Statement date (as at June 30th). The statement shows the annual pension that would be paid as of age 65, assuming you were to leave the University as of the June 30th date. Annual statements are posted on the Pension Portal for most members of the Salaried Pension Plan and will be mailed to all other individuals.

Pension Estimates

Salaried Pension Plan Members can now run their own pension estimates on the Pension Portal in Mosaic (located under Employee Self Service – Pension tile) using the Retirement Modelling tool. On the main page of the portal, there is a User Guide for your reference to assist with any questions. More information on this tool can also be found here.

For those Members who cannot access the Pension Portal, we recommend requesting a pension estimate as close to the time in which you are considering retirement to ensure accuracy of information. There is no charge when requesting a pension estimate.

Commuted Values

We do not provide estimates of commuted values prior to retirement as these numbers are based on actuarial assumptions and interest rates that fluctuate from month to month which can significantly impact the value.

For a description of how Commuted Values are calculated for Salaried Pension Plan members, click here.

The pension plan requires that employees make mandatory pension contributions set out in the plan rules and based on their employee group. Please refer to your employee group’s Pension Highlights documents located under the Hourly Pension Plan and Salaried Pension Plan tabs to see the contribution formula for your employee group.

The University’s contributions to the pension plans are not directly related to employee contributions.  The level of contributions needed to pay for members’ benefits will vary depending on a number of economic and demographic factors (e.g., interest rates, investment returns on plan assets, longevity, etc.) and depends on the plan’s funded status, as set out in actuarial valuation reports prepared on a periodic basis. Recent actuarial valuation reports have revealed that the plans are fully funded, which means there is sufficient assets to cover all present and future pension obligations. For further details, please refer to the Hourly Pension Plan and Salaried Pension Plan tabs and click on “Actuarial Valuations”.

If you are a member of a registered pension plan, your PA represents Canada Customs & Revenue Agency’s estimate of the value of your pension earned in the calendar year. The PA reported on your T4 in Box 52 reduces your RRSP contribution room for the following year.

For more information on Pension Adjustments, please refer to Canada.ca at: https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/pspa/about-pension-adjustment.html

If you are interested in potentially transferring your pension entitlements from your previous employer to McMaster University, you will first need to be eligible and have joined the McMaster University Salaried Pension Plan. Please speak to your contact at time of hire if you are unsure whether you’re eligible to join the pension plan. Secondly, the funds must still be with your former plan and you mustn’t have transferred them out at any point.  

To proceed with the transfer-in request, please follow the steps below:

1. You as the Plan member will need to complete section 1 of the Pension Transfer from Other Employer Plans form. You will then send this form to your former pension plan to have them complete section 2 of the form.
2. The completed form should be forwarded to pension@mcmaster.ca.
3. Upon receipt of the completed form, we will obtain a costing from our Actuaries of how much your previous service would cost to transfer to McMaster University.
4. Once available, we will email you a letter summarizing the costing and next steps
5. You will notify us whether you’d like to proceed with the transfer or not.
6. If you would like to proceed, you will need to forward the letter summarizing the costs to your former plan so they can arrange to send McMaster University the payment. 
7. Upon receipt of the funds, this will be deposited into the pension fund and we will apply the transferred-in service to your account, which will increase your pensionable service in the Plan and may impact your Earliest Unreduced Retirement Date.

McMaster can accept funds from any Canadian pension plan, but money will be locked-in and will be administered in accordance with Ontario pension legislation. You must confirm with your former employer that they are willing to transfer funds under these conditions.

No, we cannot accept transfers from pension plans outside of Canada.

A Buyback allows a member of the Contributory Pension Plan for Salaried Employees to purchase eligible periods of past McMaster service during which they had not previously contributed. This will increase the member’s pensionable service in the Plan, which increases the pension benefit and may impact the Earliest Unreduced Retirement Date.

1. Periods during which the Employee was Eligible for Membership but not a member (must be specified in writing with formal offer letters and there must not be a break in service immediately prior to the pension plan entry date)

• • An Employee who elects to defer enrollment in the Plan to the Mandatory Date (July 1) is eligible to buy back service to the date the Employee was first eligible to join the Plan (the immediate enrolment date versus the deferred/mandatory enrolment date).
  • An Employee who has their full-time or part-time over 50% appointment (as specified in their offer letter) extended beyond one year is eligible to buy back to the beginning of the appointment which was extended (assuming the appointment is in a position eligible to participate in the Plan).

2. Periods during which a member of the Plan is put on a lay-off and makes no pension contributions for this lay-off period. They can buy back the lay-off period provided they return to active and pension eligible employment with the University.

3. Leaves of Absence

• • An Employee who goes on a leave of absence and, in accordance with the terms of The Plan, has the option of continued participation during their leave of absence, but opts not to continue pension contributions during the leave is eligible to buy back service for the period of the leave at a later date.

• Complete the Purchase of Past Service Request Form
• Email the completed form and supporting documentation to pension@mcmaster.ca
• The Retirement Plans team will review your form and documents for completeness. Note that if you do not provide supporting documentation, the team will do their best to search for the details related to the buyback period; however, depending on the years in question, this information may no longer be available, and we may not be able to complete your request.
• Once we have all necessary information, we will obtain a costing from our Actuaries of how much your past service would cost.
• Once available, we will email you a letter summarizing the costing and next steps
• You will notify us whether you’d like to proceed with the purchase or not.
• If you would like to proceed, McMaster may need to seek approval from Canada Revenue Agency for a Past Service Pension Adjustment (PSPA), if applicable. A PSPA reduces your RRSP room for the following year, and you therefore must have enough RRSP room to be approved for the PSPA.
• You will arrange for payment of the past service via payroll deductions, a cash cheque or through transferring funds from another registered vehicle such as a Locked-In Retirement Account (LIRA) or a Registered Retirement Savings Vehicle (RRSP).
• Upon receipt of the funds, this will be deposited into the pension fund, and we will apply the purchased service to your account, which will increase your pensionable service in the Plan and may impact your Earliest Unreduced Retirement Date.

If your separation date is post-2012, then you need to go through the Family Valuation Process, which is provincially regulated by the Financial Services Regulatory Authority of Ontario (FSRA). The steps to do this are as follows:

• Complete the Application for Family Law Value Family Law Form 1 and provide the necessary documents that are listed in Part G. Follow the link to access the form (it is the first form listed under “Family Law – To be completed by members and/or spouses”): Application for Family Law Value Family Law Form FL-1 (fsrao.ca)
  • Follow the link to find the specific McMaster Pension Plan Information needed to complete FSRA Forms. You are a member of the Salaried Pension Plan. https://hr.mcmaster.ca/app/uploads/2019/01/MacFamilyLawFormPlanInfo-1-40.pdf
• Delivery: the completed forms and supporting documents can be scanned and then mailed to the following address: McMaster University, Attn: Retirement Plans team, Human Resources, Campus Services Building, Room 202, 1280 Main St W Hamilton ON  L8S 4L8

If your separation date is pre-2012, please email the pension@mcmaster.ca inbox with your inquiry.

A member of the Retirement Plans team will reach out to you after your employment ends when your pension options are available. These take time to prepare as HR will need to wait for the termination to be processed through the system and for the last payroll to go through before the team can review and calculate your options. 

Please ensure you keep your current mailing address up to date. If you would like your pension options emailed to you, please ensure you provide a personal email address that we can contact you at. You can email this to pension@mcmaster.ca.

You will have a few options at termination (this applies to those members who have not reached their ‘Special Retirement Date’ and those who are under age 55 when they leave McMaster):

• Transfer your commuted value (lump sum value) out of the Plan.
  • Depending on the value, a portion of this may have to be transferred to a locked-in account with another financial institution where you cannot touch the money until age 55; or, it may be unlocked, in which case you can transfer a portion to a non-locked in Registered Retirement Savings Vehicle (RRSP).
  • A portion of that lump sum will be paid in cash, less withholding tax.
  • Note that you will not know your value until you leave McMaster and at that time you will know whether the money would be locked-in or not.
• Transfer the full lump sum value to another Defined Benefit Pension Plan
• Leave your pension with McMaster University and start collecting the unreduced pension at age 65, or anytime between age 55 and 65 if you want to take a reduced pension (this option would not be available if your pension is considered a ‘small benefit’ under pension legislation, which you will find out when you receive your options).

Please refer to your employee group’s Plan Highlights documents located under the Hourly Pension Plan and Salaried Pension Plan tabs under ‘Plan Highlights’ for specific details regarding the termination options for your situation.

Once you have made your termination election, and if you transfer your pension value out of the Plan (into a vehicle other than another registered pension plan), you may be issued a “Pension Adjustment Reversal” (“PAR”). Revenue Canada introduced the PAR for pension plan members transferring their pension entitlement out of a registered pension plan after 1996. A PAR restores lost RRSP contribution room and is the amount by which your PA’s exceed the value of your pension earned over that period.

No PAR is calculated if you retire from the pension plan.

For more information on Pension Adjustment Reversals, please refer to Canada.ca at: https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/pspa/pension-adjustment-reversal.html

Please go to the “Planning for Retirement” webpage for further details on the retirement process. Another great resource to review is the How Do I Prepare for Retirement document. 

Yes, for all employee groups except for those hired into Unifor on or after May 1, 2010.  For employees hired into Unifor on or after May 1, 2010, you must also attain age 60 before retiring on your Special Retirement Date. The Special Retirement Date is the date at which a member can retire with an unreduced pension and will not have any further reductions to the pension amount that they have earned at their date of retirement.

Retirement options are presented to employees who have reached their ‘Special Retirement Date’ or those who have reached age 55 when they leave McMaster. The options will vary by employee group. However, most employees will be presented with pension options where they can select the form of pension that is best for their situation. In all cases, the pension is payable for the member’s lifetime. The option selected will determine how much is payable to a beneficiary or spouse upon the member’s death, if any. 

Please refer to your employee group’s Plan Highlights documents located under the Hourly Pension Plan and Salaried Pension Plan tabs under ‘Plan Highlights’ for specific details regarding the retirement options for your situation.

Salaried Pension Plan Members can now run their own pension estimates to assist in their retirement planning and help to estimate their pension amount at their desired retirement date. 

To access the Pension Portal, go to Mosaic – Employee Self Service and click on the Pension tile. On the home page, click on ‘Retirement Modelling’. The default estimate that appears is for age 65 (this may take a minute to load). You can click on the Assumptions under the chart to see that it does not project any earnings increases but uses your full-time equivalent status to project service. In the Calculation Details drop down, it shows how much service you would accrue if you stayed until your age 65 date. To run customized estimates, you can refer to the right side under ‘Assumptions’ and pick a Retirement Date and click through the tabs to adjust the assumptions (i.e. earnings increase, full-time equivalent status, etc.).

On the main page of the Pension Portal, there is a User Guide for your reference to assist with any questions.

For those Members who cannot access the Pension Portal, we recommend requesting a pension estimate as close to the time in which you are considering retirement to ensure accuracy of information. There is no charge when requesting a pension estimate. Please complete the Pension Estimate Request Form if you fall into this category.

Depending on your employee group, the pension options presented to you may include a guaranteed period. This period is the length of time in which your pension is guaranteed to be paid at 100% regardless of whether the member passes away earlier than this period. If the member is still alive when the guaranteed period ends, there is no change in pension payments for the member as their pension is still payable for their lifetime. There are multiple scenarios that can occur surrounding this guaranteed period and these are outlined below.

Members without an eligible spouse at retirement who elected an option with a guaranteed period

• If the member passes away before the guaranteed period ends, the named beneficiary will receive the remaining monthly pension payments until the end of the guaranteed period (at which time the payments will end); or will receive the commuted value of the remaining payments in cash, less withholding taxes. After the guaranteed period ends, there is nothing further payable.
• If the member passes away after the guaranteed period ends, there is no benefit payable to the beneficiary at the time of death.

Members with an eligible spouse at retirement who elected an option with a guaranteed period (84 months)

Note this option is only available to the Salaried Pension Plan Members (not the Hourly Pension Plan Members). There are two main options for members with a spouse and this will impact the treatment of the guaranteed period. 

Joint and Survivor Pension

The member receives a pension payable for their lifetime. Upon the member’s death, the pension is payable to their spouse for their spouse’s lifetime (the amount payable depends on the option elected at retirement).

• If the member passes away before the guaranteed period ends, the spouse will continue to receive the same monthly amount as the member was receiving for the remainder of the guaranteed period. When the guaranteed period ends, the spouse will receive the reduced amount, if applicable, based on the option elected by the member at retirement. *If the spouse predeceased the member in this scenario, the remainder of the guaranteed payments would be payable in a lump sum to the member’s estate
• If the member passes away after the guaranteed period ends, the spouse will receive the reduced pension amount, if applicable, based on the option elected by the member at retirement *If the spouse predeceased the member in this scenario, then pension payments cease at time of the member’s death

Joint and Survivor Pension Reducing on First Death

The member receives a pension payable for their lifetime. Upon the member OR the spouse’s death, the pension amount would reduce in accordance with the option elected at retirement.

• If the member or spouse passes away before the guaranteed period ends, the surviving spouse will continue to receive the same monthly amount as the member was receiving for the remainder of the guaranteed period. When the guaranteed period ends, the surviving spouse will receive the reduced amount based on the option elected by the member at retirement. *If both the spouse and the member pass away before the guaranteed period ends, the remainder of the guaranteed payments would be payable in a lump sum to the last surviving spouse’s estate
• If the member or spouse passes away after the guaranteed period ends, the surviving spouse will receive the reduced pension amount based on the option elected by the member at retirement

Retirees of the Hourly Pension Plan and Salaried Pension Plans may be eligible for pensioner increases each calendar year depending on a few factors. 

Any pension in pay prior to July 1st may receive an increase to their pension amount on the following January 1st (this applies to survivor pension in pay as well). Those who retire after July 1st, would not be eligible for a pension increase until the following January 1st. 

Pension increases are dependent on the pension plan fund performance and on the Consumer Price Index (CPI) in the 12 months preceding June 30. Details of how this is calculated can be found in the Pension Highlights document in your applicable employee group (click on the Hourly Pension Plan or Salaried Pension Plan tab, then on the ‘Pension Highlights’ drop-down menu)

The latest pensioner increase amounts are announced in December each year and can be found here:

Pensioner Increases for Salaried Pension Plan members

Pensioner Increases for Hourly Pension Plan members

Yes, the Government of Ontario passed legislation which requires that all retired and former members of Ontario registered pension plans be provided with pension statements on a biennial basis. The first pension statements were issued in December 2018 for the period from July 1, 2017 to June 30, 2018. Therefore, retirees will receive statements in December every two years after that (2020, 2022, 2024 etc.).

If you have not received a pension statement and you believe you should have, please contact the Employee Contact Centre by phone at 905-525-9140 extension 22247 or via email at hr.mcmaster@mcmaster.ca. 

Retirees should complete the Retiree Address Change Form and email the completed form to hr.mcmaster@mcmaster.ca and copy pension@mcmaster.ca so that we can update your address on Mosaic, CIBC, and Sun Life, if applicable. Otherwise, you can mail a copy to McMaster University, Attn: Retirement Plans Team, Human Resources, Campus Services Building, Room 202, 1280 Main St W Hamilton ON L8S 4L8

To update your banking information with CIBC Mellon, please complete the Direct Deposit Request Form and email it to pension@mcmaster.ca. Otherwise, you can mail a copy to McMaster University, Attn: Retirement Plans Team, Human Resources, Campus Services Building, Room 202, 1280 Main St W Hamilton ON L8S 4L8. The Retirement Plans team will send the updated banking information to CIBC Mellon.

Please complete the current calendar year’s tax forms and email them to pension@mcmaster.ca. If you live outside of Canada and have foreign tax, please email us and we will provide more information. 

Upon receipt, we will send the updated forms to CIBC Mellon so they can update your taxes.

Your tax slip for your pension income will be mailed by the trustee CIBC Mellon to your home address on file.

If you have any further questions, you can reach out to CIBC Mellon directly at 1-800-565-0479 from Monday to Friday between 8:30am – 6pm.

Depending on the option you elected at retirement, you may not be able to change your beneficiary.

Members who retired with an eligible spouse

Members who retired with an eligible spouse are not able to update their beneficiary once retired.

If the member passes away, the pension will be payable to their eligible spouse at retirement. If the spouse predeceased the member, then nothing* further will be payable.

*The exception will be if the member and spouse both pass away within the guaranteed period, then the amount owing will be paid to the last surviving spouse’s estate (i.e. if the spouse predeceases the member, then the member passes away within the guaranteed period, the amount owing is payable to the member’s estate. If the member passes away during the guaranteed period, the spouse receives payments in the guaranteed period and passes away before the guaranteed period ends, then the remaining guaranteed payments are payable to the spouse’s estate). 

If you have questions regarding a divorce after retirement, please contact the Retirement Plans team at pension@mcmaster.ca as there are many steps required before being able to remove a spouse after retirement, if at all and this would involve Family Law Value calculations and court documents.

Members who retired without an eligible spouse

Members who retired without an eligible spouse are able to update their beneficiary only if their guaranteed period has not ended. Otherwise, once the guaranteed period ends, nothing would be payable upon the retiree’s death and therefore no beneficiary update is required. 

To update your beneficiary, please complete the Designation of Beneficiary (Pension Plan) Form and email this to pension@mcmaster.ca. Otherwise, you can mail a copy to McMaster University, Attn: Retirement Plans Team, Human Resources, Campus Services Building, Room 202, 1280 Main St W Hamilton ON L8S 4L8

For those eligible for Retiree Life Insurance, please complete the Retiree Life Insurance Beneficiary Appointment Letter and email this to hr.mcmaster@mcmaster.ca and copy pension@mcmaster.ca. Otherwise, you can mail a copy to McMaster University, Attn: Retirement Plans Team, Human Resources, Campus Services Building, Room 202, 1280 Main St W Hamilton ON L8S 4L8

Further information regarding Sun Life coverage and claims information can be found on the Sun Life Benefit Information for Retirees page.

To continue to be eligible for extended health and dental post-retirement benefits, you must be covered under a provincial health care plan (OHIP or equivalent). Therefore, you are still eligible if you move to another province within Canada.

If you move outside of Canada and are no longer covered under your provincial healthcare plan, then you would not be eligible to continue post-retirement benefits.

If your spouse passes away, please contact the Employee Contact Centre by phone at 905-525-9140 extension 22247 or via email at hr.mcmaster@mcmaster.ca. 

If you’re receiving benefits from Sun Life, we will remove your spouse from your coverage. If you have retiree life insurance, you may want to consider updating your Life Insurance beneficiary if this was previously allocated to your spouse. Please refer to the FAQ above.

We will add your spouse’s date of death to your pension file. There would only be an impact to your pension amount if you chose the Joint and Survivor – First Death option at retirement. This option means that your pension amount will decrease when either the retiree or spouse passes away. We would need to calculate your new decreased pension amount and, in this case, it is important to contact us in a timely manner to avoid overpayments.  

In the event of your passing, the executor or surviving spouse should contact McMaster University’s Employee Contact Centre by phone at 905-525-9140 extension 22247 or via email at hr.mcmaster@mcmaster.ca to notify us. We will need the following information:

1) Member’s name and Employee ID (if known)
2) Date of death
2) Confirmation of who the person is that notified us about the death. If it is not the executor or surviving spouse, the contact should provide this information, if known
3) Confirmation of where we can send correspondence (both email and mail) and what the preferred method would be to receive the correspondence
4) Confirmation of the member’s spousal status at date of death, if known by the contact

Upon receipt of this information, a member of the Retirement Plans team will review and advise on next steps.