Government releases final ORPP design details: OCC response
The Government of Ontario outlined final design parameters for the Ontario Retirement Pension Plan (ORPP) in direct response to focused advocacy by the Ontario Chamber of Commerce and FBO. FBO is a member of the Ontario Chamber of Commerce.
Last week, the OCC provided the Province with a letter outlining the outstanding concerns regarding implementation timelines.
As the Premier noted, the design of the ORPP has changed since it was first announced.
The announcement provided clarification on some of the OCC’s concerns.
- Implementation timelines. The Government will not extend ORPP implementation timelines. This will put pressure on both government and employers to meet the January 1st, 2017 implementation timeline, which is very ambitious. These tight timelines necessitate increased collaboration between government and employers over the next 11 months.
- A new funding policy. In the event that the ORPP becomes underfunded, there exists the potential for the ORPP Administration Corporation Board of Directors to increase contribution rates by up to 0.2 percent. The OCC had been seeking a guarantee that employer contribution would not exceed 1.9 percent and we will continue to lobby the government on this point.
- A clearer definition of employment. It was unclear what constituted an “Ontario employee.” This has now been defined. A person will be considered employed in Ontario if they report to work, full- or part-time, at an employer's establishment in Ontario. This definition captures a greater number of businesses than many anticipated, including federally regulated businesses.
- A streamlined comparability test. The government is establishing a comparability test that can be applied at the level of a subset of employees. This has important implications for those employers whose employees are not offered identical benefits. For example, some employers have different benefits for part-time and full-time employees. The government has indicated that this comparability test would streamline the administrative process of assessing plan comparability.
Altogether, these points will lead to increased collaboration between government and employers over the next 11 months. The OCC intends to continue to work constructively to ensure businesses' concerns are heard throughout this process. Please reach out to Karl Baldauf, Vice President of Policy & Government Relations if your organization would like to take a more active role in these lobby efforts or for more information.
Click here to view the government's release.
Click here to view the government's technical bulletin.