Contributions and Funding

How is the Supplemental Plan funded?

The Supplemental Plan costs (including administration costs) are paid entirely by participating members and employers; the OMERS Act, 2006 does not permit cross-subsidization of costs of the Supplemental Plan by the Primary Plan. Members cover the cost of member contributions and pay for any service purchases. Employers cover the cost of employer contributions and pay for matching leave period contributions when required (for example, a pregnancy and parental leave that a member purchases).

Costs for supplemental benefits may include any related rebound costs identified by the OMERS actuary as affecting the Primary Plan – to avoid any subsidization of supplemental benefits by the Primary Plan.

What are rebound costs (Primary Plan)?

The 2.33% accrual rate benefit may influence (or encourage) a member's early retirement. This impact on the Primary Plan must be taken into consideration and Primary Plan contribution rates must be adjusted if necessary (i.e., rebound costs must be applied).

What are the Supplemental Plan contribution rates?

Contribution Rates for Supplemental Plan Benefits
Effective January 1, 2011

Benefit Members with a normal retirement age of 60 Members with a normal retirement age of 65
Supplemental Plan contribution rate Primary Plan rebound rate* Supplemental Plan contribution rate Primary Plan rebound rate*
2.33% accrual 2.15% 0.20% 1.85% 0.25%
80/85 Factor 0.45% none 0.30% none
“Best three” earnings 0.60% none 0.50% none
“Best four” earnings 0.35% none 0.30% none

 

Contribution Rates for Supplemental Plan Benefits
Effective July 1, 2008 to December 31, 2010

Benefit Members with a normal retirement age of 60 Members with a normal retirement age of 65
Supplemental Plan contribution rate Primary Plan rebound rate* Supplemental Plan contribution rate Primary Plan rebound rate*
2.33% accrual 2.75% 0.20% 2.35% 0.30%
80/85 Factor 0.95% none 0.75% none
“Best three” earnings 1.10% none 0.90% none
“Best four” earnings 0.85% none 0.75% none

*Only required if the member has the 2.33% Supplemental Plan benefit.

Notes:
  • Employers match member contributions for ongoing service (effective from the coverage start date of the Supplemental Plan benefit).
  • Contributions are deducted from a member's regular earnings (regular earnings do not include additional amounts such as overtime pay and most one-time, lump-sum payments).
  • Supplemental Plan contributions are in addition to contributions required for the Primary Plan. More information about OMERS Primary Plan rates.
  • Contribution rates are based on actuarial assumptions such as the number of participants, operational expenses and interest rates, and include administration fees. Contribution rates could be adjusted in the future to reflect the cost of the benefits earned.
  • Important! Contribution rates apply to future service. (Future service is service after the coverage start date of the Supplemental Plan benefit.) Past service costings are based on the present-day cost. (Past service is credited service in the Primary Plan that a member earned before the coverage start date of the Supplemental Plan benefit.)

What factors affect contribution rates?

The current contribution rates for the Supplemental Plan are based on an assumption of 5,000 members. The long-term viability of the plan requires membership to match or exceed assumptions.

Contribution rates are set by the OMERS Sponsors Corporation and may change.

Rates include administrative costs as well as rebound costs to ensure that all administration and operating costs of the Supplemental Plan are paid entirely by members of that plan and are not subsidized in any way by the Primary Plan.

Does the Income Tax Act maximum pension apply?

Yes. If a member's annual salary rate exceeds the amount that generates the maximum pension allowable by the Income Tax Act (ITA), Supplemental Plan contributions will stop. A member would not earn a benefit in the Supplemental Plan during any period in which their benefit exceeds the ITA limit.

Note: The limit only affects Supplemental Plan contributions. The Primary Plan includes a Retirement Compensation Arrangement to provide pension benefits for those members with earnings exceeding the ITA limit.

Contribution Tables

Access contribution tables based on historic contribution rates.
View contribution tables

Supplemental Plan benefits are not automatically provided. Employers can set up Supplemental Plan coverage for a class or classes of members in the police sector, firefighters and paramedics.

Related Links

Rate Change Notice

On August 25, 2011, the OMERS Sponsors Corporation (SC) adopted SC By-law #25 that establishes a new set of contribution rates for the Supplemental Plan for Police, Firefighters and Paramedics, to be effective retroactive to January 1, 2011. See the announcement and accompanying fact sheet PDF File [199 KB] for details.