{"id":18150,"date":"2020-04-22T15:00:59","date_gmt":"2020-04-22T19:00:59","guid":{"rendered":"https:\/\/www.benefitscanada.com\/news\/omers-considering-shared-risk-indexing-expanded-eligibility-to-non-full-time-workers-145294"},"modified":"2020-04-22T15:00:59","modified_gmt":"2020-04-22T19:00:59","slug":"omers-considering-shared-risk-indexing-expanded-eligibility-to-non-full-time-workers","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2020\/04\/22\/omers-considering-shared-risk-indexing-expanded-eligibility-to-non-full-time-workers\/","title":{"rendered":"OMERS considering shared-risk indexing, expanded eligibility to non full-time workers"},"content":{"rendered":"
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Staff<\/span> | April 22, 2020 <\/p>\n

The Ontario Municipal Employees Retirement System\u2019s sponsors corporation board is considering two plan design changes: the introduction of shared-risk indexing and the expansion of pension coverage to non full-time workers.<\/p>\n

On the shared-risk indexing front, the organization is looking at reducing future inflation increases on benefits earned after Dec. 31, 2022.<\/p>\n

As a first line of defence, the OMERS is building a reserve. If at any time the reserve isn\u2019t sufficient, the sponsors corporation will consider reducing inflation increases. This change would only impact plan members retiring after Dec. 31, 2022.<\/p>\n

Read: OMERS looking at indexing as part of plan review<\/a><\/strong><\/p>\n

Plan maturity is a driving force behind this change, according to the OMERS website. For instance, the plan used to have seven active members for each retiree and now has two retirees for every active member. Soon, the ratio will be one to one.<\/p>\n

\u201cDefined benefit pension plans work because the risks related to funding our secured retirement are shared among OMERS stakeholders, mainly our members and our employers and across generations,\u201d said Michael Rolland, chief executive officer of the OMERS sponsors corporation, during the OMERS\u2019 annual meeting webcast. \u201cAs our active to retired member ratio decreases, that responsibility is shared by relatively few active members. This puts a bigger burden on future generations. Plan maturity also reduces the plans ability to absorb shocks.\u201d<\/p>\n

Shared-risk indexing would allow the OMERs to prepare for the unknown without raising contributions, added the website, noting that, in the event of an economic shock, shared-risk indexing would spread the weight of supporting the plan over more members and more time.<\/p>\n

Read: OMERS posts 11.9% return for 2019 led by public equities<\/a><\/strong><\/p>\n

\u201cIf an economic shock similar to 2008-09 were to occur in 2045, the impact on active members would be double what it was back then, due to plan maturity,\u201d it said. \u201cThis is because the growth in what we owe (our pension obligations) will significantly outpace the growth in our active membership.\u201d<\/p>\n

In the webcast, Rolland highlighted that shared-risk indexing has already been adopted by other plans and noted it\u2019s aimed at improving long-term sustainability and ensuring equity across all generations.<\/p>\n

The OMERS is also considering removing eligibility rules so that employees who aren\u2019t full time can join the plan at any time after Dec. 31, 2022.<\/p>\n

\u201cMore and more of the workforce is now made up of non full-time workers, including those that will spend a career in roles that are non full time,\u201d said Rolland. \u201cIn simple terms, the planned change under discussion is to remove the current eligibility rules so that all non full-time employees, even those that are currently not eligible, can elect to join the OMERS plan at any time.\u201d<\/p>\n

The OMERS sponsors corporation board will make its final decision on these suggested changes in June 2020.<\/p>\n

Read: Are New Brunswick\u2019s shared-risk plans on target?<\/a><\/strong><\/p>\n

Read the full article at BenefitsCanada.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Staff | April 22, 2020 The Ontario Municipal Employees Retirement System\u2019s sponsors corporation board is considering two plan design changes: the introduction of shared-risk indexing and the expansion of pension coverage to non full-time workers. On...<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18150"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=18150"}],"version-history":[{"count":0,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18150\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=18150"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=18150"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=18150"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}