Immediate vesting starts July 1 at HOOPP

When members are vested in a defined benefit pension plan, they are entitled to a monthly income from that plan when they retire – even if they stop working for their employer before they reach retirement age.

Under Ontario’s current legislation, members are vested once they have belonged to a pension plan for at least two years. Members of HOOPP who terminate their membership before they are vested do not receive a pension; they are entitled to receive only the contributions they made to the Plan, plus interest.

New legislation in Ontario calls for mandatory immediate vesting for all pension plans in Ontario. This means that HOOPP members will not have to wait for two years before being vested.

This legislation has not come into effect, and the provincial government has not yet indicated when it will. However, HOOPP will introduce immediate vesting, effective July 1, 2012. We have chosen to move ahead with immediate vesting before we are required to do so because earlier vesting helps the member start building his or her retirement pension sooner.

This means that if members are actively contributing to HOOPP on or after July 1, 2012, they will be immediately vested. Until then, the current two-year vesting rule will apply. If, however, immediate vesting becomes law in Ontario before July 1, 2012, members will be vested when the legislation takes effect.

Dec 2011