This page provides information about the service purchase process following the 2017 faculty strike.
This process applies to all members who participated in the strike, including members who switched to the Plan's DBplus design on January 1, 2019.
As a Plan member who was on strike, you will be able to purchase the pensionable service lost during the strike. Please see below for answers to your specific questions.
Is the settlement pensionable?
The lump sum payments (of $900 and $450) that are being paid to full-time and partial-load faculty are not pensionable.
The retroactive salary increase that will be applied effective October 1 IS pensionable. This means the cost of your service purchase for the strike period (which will be provided to you), will take into account your increased earnings as a result of the retroactive salary increase.
Questions about Taxes
Is the strike purchase payment tax deductible?
Any cash purchases will be tax deductible and the CAAT Plan will issue a tax slip in the year the payment is made.
Can you use any RRSP account for the top up of the purchase cost?
Payments must be made in full, all cash or all RRSP.
How does the PSPA adjustment from the CRA affect the amount of tax we will need to pay?
PSPAs remove RRSP contribution room, but they do not impact taxes. Always ensure you review your latest notice of assessment from CRA when deciding how much to contribute to RRSPs.
Can we transfer from our RRSP to purchase the strike period?
Yes. RRSPs can be used to purchase the strike period. RRSP transfers are the member's responsibility: you must ensure transfer is completed. Payment must be for the full cost of the strike period.
Questions about the purchase process
Where do I send my payment?
All payments are to be made to the CAAT Pension Plan. If you are retiring, your Employer will assist you with direction.
Since you can make this purchase at any time before retirement, if you are not sure when you are going to retire, does it make more sense to wait until just before retirement to determine whether the purchase is worth doing?
If the precise impact to your retirement pension is an important factor in your decision to purchase, then yes, waiting until closer to retirement may be best for you.
Is it possible to make the purchase in installments?
No. The purchase must be made in one lump sum.
How much notice does the CAAT Plan need to process a pension request?
Once we receive a pension application we will send out a retirement option package within 30 days.
Does payment have to be made in a lump sum?
We only accept full payments for purchase costs. The cost does not change, and you can make the purchase at any time before you terminate or retire.
When will the strike service purchase show up on the CAAT Plan annual pension statement?
The purchase will appear on the annual statement in the year after you make the purchase.
How much notice must I give my employer of my intention to retire?
We recommend 3 months.
If I purchase the strike service a year from now, will the cost to purchase change?
No. The cost does not change.
Benefit of making the purchase
Does the service purchase affect the date for earliest unreduced pension?
If you have already reached your earliest unreduced pension date, then the date will not change. If you have not reached this date, and you do not purchase the strike your earliest unreduced date could be 5 weeks later than if you do make the purchase.
I may retire about 5 years from now. How can I calculate the impact of the strike on my pension? What can I do to mitigate this?
The cost is 2 times your contributions for 5 weeks. For an estimate of the cost, refer to your most recent pay stub, calculate how much you contribute weekly, double it and multiple by 5.
What impact will the strike period have on survivor benefits? Do survivors get the same amount as I would?
The strike has no impact on your survivor benefits. The eligible spouse is entitled to 60% of your lifetime pension at the date of your death.
Questions about highest average pensionable earnings (HAPE)
Are the years used for HAPE academic or calendar years?
To clarify, If I purchase the strike service, will my HAPE AND pensionable service for 2017 be equal to what they would have been if there had not been a strike? (Pensionable service = 1 year and HAPE: what I would have earned had there not been a strike?
Is it possible that the strike will lower my HAPE because it happened in my last 5 years?
Yes. Without the strike purchase, the HAPE could be slightly lower for those retiring in the next 5 years.
How much does it cost to purchase the 2017 strike service?
The cost of the purchase is two times the contributions you would have made during the strike. The contributions are based on the salary you were earning at the beginning of the strike, and the contribution rates on that date. Once the purchase cost is calculated, it will never change.
The cost is 100% payable by you (the member), and the payment must be made in a lump sum. There is no employer contribution.
I’m part-time and part of the OPSEU bargaining unit that participated in the strike. Will I be able to make the purchase?
Yes. Your purchase will use the same process as full-time striking members at your college.