Transfer of a Pension Plan to a New Employer

• Eligibility
• Steps to take
• Transfer agreement
• Special conditions

Transfer agreements exist between Retraite Québec and certain organizations that administer pension plans. The agreements allow a person that changes job to transfer, in whole or in part, the years of service accrued under his or her pension plan to his or her new plan.

Each of the agreements negotiated between Retraite Québec and a partner organization describes the rules, calculation methods and administrative directives relating to the agreement.

The transfer agreements ensure members a greater financial security in retirement. They allow the date of eligibility for a retirement pension to be moved ahead and to increase the amount of that pension.

Eligibility

The eligibility requirements for a transfer may vary from one agreement to another. However, the following requirements must be met for most transfer agreements:

• You must have ceased to hold a position covered by the former plan and ceased to participate in the plan.
• You must participate in the receiving plan for at least three months prior to the date on which the application for a transfer is received.
• You must not:
  • have obtained the refund of your contributions;
  • have received a retirement pension from the exporting plan;
  • be eligible for an unreduced immediate pension under the exporting plan. The only exception is in the case of a transfer under the Entente avec le gouvernement du Canada and the Entente Enseignants – Entente interprovinciale (French only);
• You must have accrued rights and benefits under the exporting plan.

Steps to take to take advantage of a transfer agreement

You must first verify whether an agreement has already been entered into between the administrator of your former plan and Retraite Québec. To do so, consult the list of agencies and plans affected by a transfer agreement.

• If the former administrator of your plan has entered into a transfer agreement with Retraite Québec, you must complete and sign the Application for Transfer Estimate (Appendix A) form relevant to your agency and send it to the agencies concerned. The form is available in the list of agencies above.
• If the former administrator of your pension plan did not enter into a transfer agreement with Retraite Québec, you must complete the Application for a New Transfer Under Agreement (RSP-365A) form and send it to Retraite Québec. This will allow Retraite Québec to start discussions with the administrator in order to enter into an agreement.

Transfer agreement

For a transfer agreement to be concluded, the partner organization's plan must be a Registered Pension Plan. Since group registered retirement savings plans (group RRSPs) are not, they cannot be the subject of an agreement.

If the partner organization administers a Registered Pension Plan, the pension committee must approve the transfer agreement with Retraite Québec. At any time during the negotiation process, the committee may terminate the process or refuse to reach an agreement.

Once the agreement has been reached and signed by Retraite Québec and the partner organization, it remains in force as long as one of the parties has not indicated that they would like to terminate it.

The time required to reach an agreement may be more than a year after it has been requested.

Special conditions

The Supplemental Pension Plans Act allows for the administrator of such a plan to transfer, without agreement, the value of benefits accrued to another plan upon termination of employment. In many cases, following the transfer, the amount corresponding to the accrued benefits remains in the receiving plan until retirement, without allowing for additional years of service to be recognized.

However, the laws regarding public-sector pension plans administered by Retraite Québec do now allow for the receiving plan to receive amounts if no transfer agreements exist regarding the plans in question. Therefore, to be permitted, a transfer must be made under the terms of an agreement and result in the years of service to be recognized based on the amounts transferred.

Under special conditions of the Supplemental Pension Plans Act an administrator may, under certain circumstances and following a termination of employment, force the transfer of the value of accrued benefits and impose a time limit to carry out the transfer. If you find yourself in one of these circumstances, we suggest that you contact the plan administrator directly and request that the funds not be transferred until a transfer agreement has been reached with Retraite Québec.