For employers and employee groups interested in bringing DBplus to their workplace
Joining the CAAT Pension Plan is simple. To make an informed decision on joining the Plan, we offer the resources below, including handbooks, downloadable forms, and more.
This page will be useful to you if:
The CAAT Pension Plan offers what Canadians want in a workplace retirement savings plan. Members are freed from the stress and risks of making investment decisions. Most important, they can rely on the certainty of predictable and secure lifetime pension payments, plus other valuable retirement features. Find more resources and information below.
Find out what CAAT offers to members.
Learn about the member benefits.
Try this simple tool to estimate the value of a pension in DBplus.
Access our videos to learn more about DBplus benefits.
The CAAT Pension Plan offers a solution that works. By joining or merging your existing plan with the CAAT Pension Plan, you will be freed of the risks, costs, and administrative effort of operating your own pension plan. You’ll also offer a valuable benefit that helps attract and retain top talent. Find more resources and information below.
Learn the advantages of joining the CAAT Pension Plan as an employer.
Forms and PDFs
Access more information to support your decision by choosing your situation below.
If you have any questions about the Plan, the process to join, or mergers, we’re here to help.
For member groups and employers that are bargaining or considering bargaining pensions, we provide impartial information and respect confidentiality.
The CAAT Pension Plan stands 124% funded on a going-concern basis.
The Funding Policy keeps the Plan sustainable over the long term.
Shared governance is at the core of our success.
Meet our team of industry leaders.
Access our latest Annual Report, Year-in-Review and live webinar recordings.
Learn the simple steps to join DBplus specific to your existing situation.
Learn how Canadian employers and their employees are benefitting from joining or merging with the CAAT Pension Plan.
Find answers to the due diligence questions that employers often ask regarding the process of merging with or joining the CAAT Pension Plan.
The CAAT Pension Plan is an Ontario-registered defined benefit pension plan with one pension fund and two plan designs. We are considered a jointly sponsored pension plan (JSPP) under the Pension Benefits Act (Ontario). The original plan design is called DBprime and the newer plan design is called DBplus. The two plan designs provide similar benefit value for contributions made. DBplus is open to workplaces of different sizes, sectors, and industries across Canada. There are exceptions that apply which may require individual regulatory approval from appropriate provincial authorities.
DBplus is part of the CAAT Plan and there is no separate fund. It has one funded ratio and one fund with Plan assets and reserves for all.
CAAT’s more than 94,000 members include active, retired members, those with a deferred pension, surviving spouses and other beneficiaries. About half of the more than 64,900 active members are in DBplus, and the other half are in DBprime.
The CAAT Pension Plan had been in existence for more than 50 years, primarily serving the Ontario College system. In 2015, the Plan began its process of opening up to employers outside the college system, and welcomed the Royal Ontario Museum in 2016, followed by the Youth Services Bureau of Ottawa. All these groups participate in the original plan design now called DBprime.
In recent years, many workplaces and their pension needs have evolved, both inside and outside the college system (for example, the prevalence of part-time and contract employment). It was clear that an additional pension solution was needed that addressed the evolving needs of employees and employers. DBplus was designed and approved in 2018 to:
In October 2018, Torstar joined DBplus, offering membership to all employees (i.e., full-time, part-time, and contract employees) after CAAT allowed any non-college Ontario employer. to seek participation in the Plan. In 2019, at the request of several national employers, workplaces from across Canada were able to seek participation in DBplus. In 2019, all part-time members of the CAAT Pension Plan (from all employers) were migrated to DBplus. Today, more than 370 employers in 20 industries have joined CAAT under DBplus, representing more than 94,000 members over across Canada.
The Plan is a jointly sponsored pension plan with the Plan governors appointed by the following sponsors of the Plan:
The Sponsors’ Committee is an eight-member group of equal member and employer-appointed representatives. It approves Plan amendments, the filing of any off-cycle actuarial valuations, and the applications of new employers. The Committee’s focus is determining how to best balance contribution rates and benefit design. Any decision of the Sponsors’ Committee must be unanimous.
The Board of Trustees is a 12-member board with equal numbers of appointees representing members and employers. As fiduciaries, Trustees are legally bound to act in the interests of all Plan members. The Board of Trustees sets the investment strategy and funding risk that are appropriate for the Plan’s long-term obligations and establishes policies for administering benefits. Equal representation and voting extend to the following subcommittees of the Board of Trustees that make recommendations to the Board in particular areas of focus: Appeals Subcommittee, Audit Committee, Finance and Administration Committee, Governance Committee, Investment Committee.
Our team of investment professionals oversee the Plan's investment strategy as set out in our Board of Trustees-approved investment policies. They select investment management firms, funds and co-investments that meet our criteria and quality standards, and they monitor performance against targets for both returns and for risk.
Comprehensive information – including investment strategy, investment policies, responsible investing, information about asset mix and performance, and our investment team – can be found on the website's Investment section and in our annual report.
Our investment team combines internal expertise and oversight with a selection of external managers to deliver long-term performance and value. The team oversees the fund’s investment strategy as approved by the Board of Trustees, as well as the activities of approximately 60 high-quality investment and fund managers that employ a diversified mix of investment approaches within a wide array of asset classes. The result is a well-diversified portfolio of public and private market investments that reduces risk and is expected to meet the Plan’s long-term required rate of return, to fulfill its benefit obligations to members.
Our most senior investment team members are:
Asif Haque – Chief Investment Officer.
Read more about Asif Haque.
Kevin Fahey – Managing Director, Private Markets.
Read more about Kevin Fahey.
In selecting investment and fund managers and co-investment partners for recommendation to the Investment Committee of the Board of Trustees, as well as monitoring them on an ongoing basis, the investment team follows disciplined processes for due diligence with the intent of hiring investment and fund managers that:
The processes, which vary for public and private market asset classes and for co-investments, consider a myriad of factors concerning a firm’s organization, staff, investment strategy and process, portfolio characteristics, how environmental, social, and governance factors are considered in the investment process, and fees. Additionally, operational due diligence processes are carried out by the Plan’s finance team to minimize non-investment related risks, such as reporting or operational errors and fraud.
DBplus has standard plan provisions. However, in the right circumstances there is some flexibility on certain design elements such as contribution rates and who can join.
CAAT has a goal of providing flexible solutions to employers. Organizations set the contribution rates that work for them and who is eligible to enroll. Our expertise is creating tailored solutions suited to employers’ budgets. To determine the best approach for your organization, please contact our team.
Where employees are joining from an existing retirement plan which has a different definition of pensionable earnings (i.e., different than T4 Earnings), CAAT may consider this aspect of participation as part of the application process. Please contact our team to learn more.
Eligibility may be open to specific classes of employees or all employees
CAAT will work with the employer to identify classes of employees who would join DBplus. Any such classes would have to conform with applicable pension standards legislation, regulatory guidelines and CAAT policy.
Different classes of employees can have different contribution rates
Different contribution rates may be applicable to each class of employees participating in DBplus. Any such classes would have to conform with applicable pension standards legislation, regulatory guidelines and CAAT policy.
Based on our asset-liability modelling, CAAT is confident that such enhancements will continue to be granted. While this cannot be guaranteed, we note that since conditional post-retirement indexing was introduced back in 2007, CAAT has never missed providing an increase, including during the global financial crisis (GFC) . Similarly, pre-retirement wage inflation enhancements have always been provided since they were introduced with DBplus in 2018. These enhancements are subject to the CAAT Pension Plan Funding Policy and once granted they form part of the member’s lifetime pension and can never be taken away.
In the unlikely event that the funding level deteriorates such that additional future conditional enhancements are not provided, a catch-up would be provided in the future when the funding level improves, as per the Funding Policy.
The option to transfer out one’s commuted value (CV)applies to members who are not yet eligible for retirement (i.e., under the age of 50) and who have met the 24-month extension of membership requirement, so essentially under 48 years of age at termination of employment. It is important to note that our Plan also allows members to transfer their pension entitlement out to another employer’s Defined Benefit plan after the age of 50 provided that plan accepts transfers. Also, when the member leaves their deferred pension with CAAT, it continues to grow with conditional inflation increases before and after retirement, subject to the CAAT Pension Plan Funding Policy.
As required by pension legislation, commuted values (CV) are determined by following recommendations made by the Canadian Institute of Actuaries. A commuted value is the lump sum present value of expected DBplus benefit payments in retirement that have been earned up to the date of membership end date (or the end of membership date).
If the retired member has an eligible spouse at the time of their death, the retired member’s eligible spouse will receive a survivor pension for life equal to 60% of the CAAT pension the retired member was receiving. The survivor pension receives the same conditional inflation protection increases as member pensions.
If the retired member has no eligible spouse at the time of their death, or after both the retired member and the eligible spouse are deceased, and the retired member had an eligible child, a children’s pension will be payable until the child no longer meets the applicable definition and stops being eligible. A child is eligible for survivor benefits if they are under age 18, or are under the age of 25 and a full-time student, or are unable to support themselves due to disability (and either became disabled before the age of 18 years or before the age of 25 years if the child was a full-time student).
Under the provisions of the 60-month minimum pension guarantee, a beneficiary could receive a payment equal to 60 times the member’s initial monthly pension amount less the sum of all payments to the member, the eligible spouse, and any eligible children. Members whose jurisdiction of employment at retirement was Quebec had the option to select 120 months.
CAAT has an additional survivor benefit provision. If the retired member does not have an eligible spouse at retirement, or the eligible spouse at retirement pre-deceases the retired member, and the retired member has a subsequent spouse at the time of their death, that subsequent spouse would become the eligible spouse entitled to the survivor pension, provided they qualify as a spouse under applicable pension legislation.
The employer’s only obligation is to match member contributions in accordance with their Participation Agreement with CAAT. No other expenses are payable. For example, member presentation sessions or workforce early retirement program calculations are provided at no cost.
The Participation Agreement requires the participating employer to:
There is no employer financial liability when the CAAT Plan is less than 100% funded. Funding under DBplus is limited to the fixed contribution rates agreed to in the Participation Agreement and any applicable Memorandum of Agreement. There are no residual liabilities for benefits accrued under DBplus beyond remittances at the agreed rate. In the event of a funding deficiency, future benefit accruals could be temporarily altered (e.g., lower future accrual rate) – not contributions.
Further, benefits already earned in DBplus can never be reduced while the Plan is ongoing. The CAAT Pension Plan is not a target benefit plan and cannot reduce accrued pensions (including enhancements that have been granted), except on the highly unlikely event of a total Plan wind-up.
There is no employer financial liability on wind-up of the CAAT Pension Plan with respect to DBplus accruals. In the highly unlikely event of a Plan wind-up (which would require virtually all participating employers to cease participating including the 24 Ontario Community Colleges that are required to participate) and there was a funding deficiency, then benefits accrued under DBplus could be reduced as legislation does not permit jointly sponsored pension plans like CAAT to go back to members or employers seeking additional contributions.
Conservatism is built into the plan design and the Funding Policy, which suggests that over the longer term the Plan’s funding health should continue to improve. All our asset-liability models demonstrate this expected trend.
Deterioration in funding levels will not impact past benefits already earned. Accrued benefits, including enhancements, once granted, can never be reduced while the Plan is ongoing.
The CAAT Pension Plan Funding Policy defines six levels of Plan financial health and sets guidelines for the Plan governors to use reserves and conditional benefits to manage through periods of volatility, to keep the Plan sustainable over the long term to secure benefits while balancing fairness across the membership.
As the Plan increases its reserve levels (i.e., as it rises through the levels in the Funding Policy), the rate of accruals under DBplus can increase or other enhancements be provided. Similarly, if reserve levels decrease, future benefit accrual rates may be temporarily scaled back – with catch-up as the Plan moves back up the funding levels. See the Funding Policy summary and read more on how the policy impacts various benefit features.
In short, there is no accounting risk under the DBplus plan design under any accounting standard. Because the contributions an employer makes are a fixed percentage of earnings, and not dependent in any way on the health of the pension plan, DBplus meets definitions for DC accounting under IFRS, US GAAP, ASPE, and PSAS.
The Public Sector Accounting Board (PSAB) is looking at accounting for DB plans on government financial statements. As they are doing so, arguments have been made that because contributions to the pension plan are potentially dependent on the health of the pension plan, that risk of needing to contribute more should be reflected on all the employers participating in the pension plan.
Currently, employers that participate in a multi-employer pension plan and would otherwise be required to follow DB accounting are allowed to use DC accounting on the basis that there is insufficient information to allocate pension assets, obligations and costs among participating employers. Some stakeholders suggest that ‘exemption’ should be eliminated, which would result in hospitals, municipalities and others including pension amounts on their financial statements. A C.D. Howe Institute ‘Commentary’ (which CAAT provided input into without influencing the results) focused solely on the accounting of governments and entities reflected on governments’ books and supported that approach where there is risk employers would need to contribute more, while noting that the majority of Canada’s public pension plans are very well funded and such risk is low (including of course, under CAAT’s DBprime plan design).
A change in accounting treatment is a risk for colleges participating in the CAAT Pension Plan under the DBprime plan design, which meets the definition of a DB plan. In CAAT’s opinion, it is unlikely the PSAB will eliminate the exemption for multi-employer plans, as it would be contrary to international government accounting standards which all other accounting standards use as a principle. In the worst case, a possible solution would be for the colleges to convert all members to the DBplus plan design, eliminating the accounting treatment issue.
CAAT Pension Plan provides a great deal of transparency to all employers (and other stakeholders). Employers have various contact points at CAAT depending on the information they are seeking.
The Employer section on the CAAT Pension Plan website, provides much information for employers, including an online Employer Manual which helps employers that participate in the Plan understand and carry out their roles and responsibilities.
Employer contacts (payroll and benefits departments, etc.) are also provided with training and can contact CAAT by phone at 416.673.9000 or 1.866.350.2228 (toll free) or by email at firstname.lastname@example.org.
There are many opportunities and avenues for stakeholders to raise issues, including:
CAAT executives can continue to support employer governance reporting related to pensions well beyond the participation effective date.
DBplus is designed to minimize administrative work for participating employers. There are, however, certain responsibilities that must be carried out by employers include the following:
For explanations of each of these responsibilities, please see our DBplus Employer Responsibilities summary document. CAAT staff provide education, training, and support for all these functions.
At the beginning of 2023, the CAAT Pension Plan was 124% funded on a going-concern basis, with $4.7 billion in funding reserves. This means that for the value of every dollar of pensions owed to members there is $1.24 in assets standing behind that pension promise and protecting against investment market declines and demographic shocks. In addition, the Plan had $537 million in asset-smoothing reserves to protect against short-term market declines.
For January 1, 2023, the Plan’s governors set the discount rate at 5.10%.
The discount rate is a key assumption in the valuation, based in part on expected investment returns over the next 20 years. The discount rate is then adjusted to reflect the Plan’s risk tolerance and focus on benefit security. The lower the discount rate, the greater the likelihood we’ll reach or surpass the investment targets needed to keep the Plan strong. In other words, a lower discount rate will lead to the Plan being more secure in the long run.
These discount rates are net of a 0.40% implicit provision for expenses and a 0.40% margin for adverse deviations relative to our external actuary’s best estimate of the long-term expected return on Plan assets reflecting their best estimate of expected returns for each of the major asset classes based on market conditions on the valuation date and the target asset mix specified in the Plan’s investment policy.
For more information, and to access our valuation report, please visit the Valuation page.
Yes, funding reserves are expected to grow due to conservatism in our approach to the discount rate and to ensuring all other assumptions, such as longevity, are reasonable.
As the Plan provides for DB benefits at a fixed contribution rate it has some conservatism in the accrual rate. This leads to building reserves which are then used to enhance member benefits. In short, future contributions are slightly higher than the actuarial current service cost of future benefit accruals when the enhancements are excluded. When the enhancements are included, the contribution rates and current service cost are roughly equivalent.
Based on our modelling, benefits from DBplus are anticipated to be twice as much compared to those from a large DC plan. Even if enhancements were not granted, DBplus benefits are expected to be significantly higher due to the Plan’s profit-for-members structure, efficiencies of scale, and other value drivers described in this report commissioned by the Healthcare of Ontario Pension Plan (HOOPP).
Our asset-liability modelling shows that the Plan is very strong and will remain fully funded (Level 2 and above and paying indexation) in about 99% of scenarios tested during our 2019 asset liability studies. Even our Level 1 (deficit) scenarios showed a very strong funded ratio of between 95% to 99% funded. The economic conditions that would be required for CAAT to be in deficit would also create significant losses to members who belong to a DC plan. There are very few economic scenarios that would lead to DC members being better off compared to belonging to DBplus.
The asset-liability modelling tests many scenarios, including if the active membership were to significantly decline. The Plan remains well funded in these scenarios. Even in the highly unlikely scenario that there were no further contributions to the Plan (and hence no further accruals), the large surplus (as noted in CAAT’s valuation report – see the Reference Valuation section of the report) would enable the Plan to remain financially strong and not be reliant on future contributions.
The Plan must always file a valuation (at least every three years) which triggers the actions required in the Funding Policy based on the funding level. If Plan funding was to start to improve or decline the Funding Policy provides the roadmap to gradually increase or reduce the future enhancements. Read more on how the Funding Policy impacts various benefit features.
Yes. The CAAT Plan is a highly respected industry leader that has been delivering secure, lifetime pensions for over 50 years. Joint governance by member and employer representatives keeps the CAAT Plan’s focus on benefit security, equity, and long-term sustainability. CAAT more than 300 full-time dedicated staff who are aligned to delivering secure and sustainable pensions. CAAT does not pay bonuses to any of its staff including the CEO, CIO, or COO. Additionally, CAAT staff are members of the Plan and are equally invested in the security and success of the Plan.
Review CAAT Pension Plan’s annual report.
Growing membership in the CAAT Pension Plan through new participating employers and beneficial mergers with other defined benefit plans increases and diversifies the Plan membership, thereby strengthening the Plan through improved risk pooling and efficiencies. All mergers are approved by the CAAT Pension Plan's governors to ensure that the health of the Plan cannot be jeopardized as a result of mergers or new groups joining.
Yes. The asset mix is well-diversified, with exposure to a broad range of asset classes. The Plan’s investment strategy is implemented through a mix of external investment manager relationships as well as private market fund investments and co-investments (direct investments in private market transactions alongside lead investors).
While past performance does not guarantee future performance, we note that the Plan’s 10-year performance has added over $537 million in value to Plan assets above the policy benchmark returns. The CAAT fund 10-year annualized rate of return net of fees is 9.7% which compares to an 8.5% policy benchmark return. Our target is to add 70 basis points above our benchmark. Historically, we have been well above that goal.
For more information, please visit the Pension solutions page or review our Annual Report.
Information provided to new eligible employees and new members includes:
An active member’s Annual Pension Statement is a comprehensive summary of their membership, in the Plan from the date joined until December 31 of the previous year. It shows a calculation of the pension earned, any pension purchased or transferred in from another plan, as well as potential retirement dates. Samples are available upon request.
Visit the Pension solutions page to access information for members, including videos, webinars, a pension estimator tool, and a pension purchase tool.
Members can also contact CAAT by phone at 416.673.9000 or 1.866.350.2228 (toll free) or by email at email@example.com.
Yes. The Retired Member Annual Statement has a personalized and detailed breakdown of their monthly pension they have earned in CAAT, inflation protection increases, and beneficiary information. Members with a deferred pension also receive an annual statement.
The CAAT Pension Plan conducts member surveys annually and those surveys show that members continue to value their pensions highly and have trust in the Plan’s expertise and joint governance. The feedback received through the surveys provide important input to setting the Plan’s strategy.
Key findings from member surveys include:
Discontinuance of participation in the Plan is set out in the Participation Agreement. The participating employer may discontinue its participation in the Plan after the minimum period set out in the Participation Agreement, provided it does not contravene any collective bargaining agreement applicable to the employer’s employees and sufficient notice is given to unrepresented employees.
Contributions by and on behalf of the employer’s active members would cease, and they would be treated as having terminated membership and entitled to benefits and options in accordance with the Plan rules and pension legislation.
The exit of a participating employer has no impact on other participating employers or other Plan members.
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