Legal Resource Guide

Pensions law The endanGeRed nesT eGG By marg. Bruineman h istoric low interest rates these past few years have been great for people buying a house or a car, but they haven't been good for private pension plans. Even as interest rates are creeping up, many of the plans we get at work are underfunded and the employer has to find a way to respond. And that means change. People who have pension plans are seeing some of their retirement benefits cut or completely new plans that don't guarantee a set amount upon retirement. At the same time, there's a movement afoot to get more people and companies involved in affordable plans. Even though Canadians often rely on private pensions to sustain their retirement, many simply don't have one. About 80 per cent of public-sector workers and close to 20 per cent of private-sector workers in Canada participate in some sort of pension scheme. 16 wiTh low inTeResT RaTes and oTheR PRessuRe on The eConoMy, CoMPanies aRe sTRuGGlinG To MainTain Pension Plans. whaT do you need To know? Mitch Frazer describes retirement as a three-legged stool consisting of personal savings, public pension plans (like the Canada Pension Plan), and private pension plans. "The issue of pensions has truly come to the forefront," says Frazer, a pensions lawyer at Torys LLP and author of A Practical Guide to Private Pension Plans in Canada. As companies struggle to meet their obligations with definedbenefit plans, which guarantee a pre-set monthly retirement income, they are looking at making plans more affordable. One option is for them to pump more money into the plans. Another is to cut some of the benefits they offer. Amendments can be

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