Starting January 1, 2013, benefit calculation changes affect you if your employment ends and you are not yet eligible for an pension. That is, if you have not reached your early retirement birthday (55th birthday for 65, or 50th birthday for normal retirement age 60), your benefit will be calculated in two parts:
- The benefit based on pre-2013 includes preretirement indexing (inflation protection) and early retirement subsidies (including the OMERS Plan ).
- The benefit based on post-2012 credited service does not include pre-retirement indexing or early retirement subsidies (including the OMERS Plan bridge benefit).
These changes apply only if you leave your OMERS employer before
your early retirement birthday.
Inflation protection (pre-retirement indexing)
Pre-retirement indexing is the inflation protection we apply to your benefit from the date you leave your OMERS employer to the date your pension begins.
The pre-2013 portion of your benefit will include inflation protection, whether you leave your benefit in the OMERS Plan or transfer the commuted value out. The post-2012 portion of your benefit will not include pre-retirement inflation protection.
Early retirement subsidies
Early retirement subsidies affect your benefit calculation for service earned after 2012 and the amount of the OMERS Plan bridge benefit.
As of January 1, 2013, your benefit will be calculated in two portions: pre-2013 and post-2012.
The pre-2013 portion:
The post-2012 portion:
- You may eventually qualify for an unreduced pension for the pre-2013 portion, or if not, your early retirement pension will be reduced by 5% per year you’re short of the 90 Factor or 85 Factor, 30 years of service, or your normal retirement age. (This is the “subsidized” reduction.)
- The OMERS Plan bridge benefit will be included in the pre-2013 portion.
- This portion no longer includes a possible unreduced early retirement pension. When you eventually begin your pension, the post-2012 portion will be reduced on an actuarial-equivalent basis (an “unsubsidized” reduction).
- If your normal retirement age is 65, the OMERS Plan bridge benefit will not be included in the post-2012 portion.
- If your normal retirement age is 60, a five-year portion of the bridge benefit (from age 60 to 65) will be included in the post- 2012 portion.