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Supplementary Plan (SERP)

In Newsletter 29 (May 2006), we announced that CLPENS would no longer be involved in the SERP issue.  The full text of the statement is as follows:

"The mandate of CLPENS is to safeguard the interests of the registered plan members.  Accordingly as indicated in the last newsletter, we have had initial discussions with our actuarial advisors, Robertson Eadie and Associates, and our legal advisors, Koskie Minsky.
 

Our actuarial advisors have confirmed that the partial wind-up of the SERP has had no effect on the surplus position of the registered plan. CLPENS will not pursue the SERP issue further.
 

There does however appear to be grounds for consideration of a legal action on behalf of SERP members.  The SERP group will be scheduling a meeting in the near future so that interested SERP members can organize a separate action if that is their desire.  Communication around the logistics of that meeting will be via e-mail to the existing SERP distribution list. "

The following information is retained here for historical purposes. 

Overview

SERP is an acronym which stands for Supplemental Employee Retirement Plan.   In common usage this means any plan which provides a pension to be added to the maximum pension that the income tax rules will allow in a registered plan.

At Canada Life there existed a SERP for many years, but it was an informal arrangement approved by the Board of Directors.   Basically the Directors said that, at retirement, a person’s pension would be calculated using the plan formula as if the income tax maximum did not exist.   The excess over what the registered plan was allowed to pay would be paid out of Company funds.   Until recently, anyone who was in receipt of a pensionable salary of about $100,000 would be eligible for a benefit from the SERP.

Around the time the Company demutualized, the SERP was made into a formal plan with the necessary funds put into a trust.   This meant that, from that time onward, eligible employees could rely upon a specific plan rather than just a promise from the Directors which could have been repealed by any future Board.                     

In 2005, Great West decided to wind up the new formal plan for certain members.   However, thanks to those who decided to formalize the plan and trustee the assets, Great West is obligated to provide a fair value to each person affected.

Communications on the SERP Issue

Jan 2, 2006 

Nov 30, 2005

Oct 31, 2005   (pdf file)

SERP Comparison Spreadsheet  

Please note that you will need Microsoft Excel on your computer to run the spreadsheet, and you may need to “Enable Macros” when prompted.

SERP Comparison Spreadsheet (106 KB)  

For details on using the SERP Comparison Spreadsheet, please view this Companion document.

If you are unable to run the worksheet, you may send the data on your letter to us and we will run it for you.

Sample Letters

Sample response letters to Company.

Page Last Revised

07 May 2011

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