Setting Up Coverage

Only an employer can establish Supplemental Plan coverage.

When an employer sets up Supplemental Plan coverage for a class or classes of employees:

  • The benefit applies to all members identified within the class of employees being covered – a member within the class may not “opt out” of the benefit.
  • The benefit is earned on a go-forward basis and funded by member and employer contributions. These contributions are in addition to contributions required for the Primary Plan. (The coverage starts on the effective date as specified in the agreement between the employer and OMERS or the member's enrolment date, if later.)
  • OMERS will provide costing information for members who have past service available to purchase:
    • Past service is credited service in the Primary Plan that a member earned before the coverage start date of their supplemental benefit.
    • The past service cost is the present value of the future benefit being purchased and is paid by the member. More details about past service purchases.
    • The costings include past service on OMERS records at the time the statement is produced. Past service not yet posted to a member's record (e.g., current year service) can be purchased once it appears on the member's Pension Report.

Retroactive coverage

A Supplemental Plan coverage start date may be retroactive to an earlier period in the year or to a previous year. When this occurs:

  • The employer must deduct retroactive contributions for each member who was an active member of the class of employees for which coverage is being provided. If the member is not currently part of the class, but was during some or all of the retroactive period, the applicable retroactive contributions must be deducted in a lump sum. Retroactive contributions must be remitted to OMERS immediately.
  • The retroactive contributions must be based on the contributory earnings and Supplemental Plan contribution rate that was in effect for each year in the retroactive period.
  • When there is retroactive coverage and the benefit is the 2.33% accrual rate, OMERS will calculate a past service pension adjustment (PSPA) for the retroactive period and report it to the Canada Revenue Agency (CRA). The CRA will subtract the PSPA from each member's RRSP room and notify the member if there isn't enough RRSP room. In this case, the member would contact OMERS to discuss their options. If there isn't enough room and the member does not free up RRSP room, the coverage start date for that member would change.

Note: PSPA reporting only applies to the 2.33% accrual rate benefit; it does not apply to other Supplemental Plan benefits. 

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.