This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.
(June 2, 2015) The Ontario Mining Association, and a coalition of major Ontario employers under the leadership of the Ontario Chamber of Commerce (OCC), are calling on the provincial government to broaden its definition of a comparable pension plan under the Ontario Retirement Pension Plan (ORPP).
In a letter addressed to Premier Kathleen Wynne, the coalition of more than 150 organizations is urging the government to expand its definition of pension plan comparability to include capital accumulation plans, including (but not limited to) Defined Contribution plans. This move would ensure that companies in the province that have an existing pension plan for their employees would not be forced to incur this new cost of doing business, thus undermining the province’s economic competitiveness.
Set for introduction in 2017, the ORPP will require employees and employers to contribute 1.9% each (3.8% combined) on an employee’s annual earnings up to $90,000. Employers who offer ‘comparable’ workplace savings plans will be exempt from contributing to the ORPP.
In its 2014 Consultation Paper, the government indicated that only Defined Benefit and Target Benefit Multi-Employer Pension Plans will be considered ‘comparable’ to the ORPP, namely Defined Benefit and Target Benefit Multi-Employer Pension Plans. Employers who offer defined-contribution plans, Group RRSPs, and Groups TFSAs are not exempt from contributing to the ORPP.
“While the Ontario Mining Association supports the government’s goal of helping Ontarians prepare for a secure future, we share the concern of the broad business community that, in its current form, the ORPP would penalize businesses that are already contributing to their employees’ retirement savings,” said Chris Hodgson, President of the OMA.
“The OMA represents companies that have been contributing to workers’ retirement savings for decades and will continue to do so. We don’t believe that it is necessary to include those who already have access to savings in their workplace in the ORPP.”
The OMA will continue to work with the coalition partners and the provincial government as Ontario moves forward with the implementation of a new pension plan that strengthens our collective retirement income system, while protecting employers and jobs.