Ontario Helping Workers Plan for Retirement

Ontario is implementing a permanent framework for target benefit pension plans to help workers prepare for retirement while supporting the sustainability of multi-employer pension plans.

This framework, effective January 1, 2025, aims to encourage more employers to adopt these plans, enabling workers to build their retirement savings. Target benefit pension plans provide retirees with a reliable monthly income while offering employers predictable costs. These plans are often created by unions or industry associations, particularly in sectors like the skilled trades, allowing members to retain their pension participation even when switching employers. This portability promotes job mobility and attracts more workers to skilled trades.

The new framework ensures clear rules and responsibilities to support stability for workers and retirees. Following consultations with industry stakeholders, the government finalized regulations to establish this framework. Multi-employer pension plans wishing to convert their benefits to the target benefit model can apply for regulatory consent beginning in 2025.

The framework incorporates measures to strengthen plan governance, enhance member communication, and improve funding management. The government plans to monitor the new system to ensure it meets its objectives and continues to address the needs of workers and retirees.