Multi-employer Pension Plans and Negotiated Contribution Plans (NCP) (Defined Benefit Plans)

The PBSA defines a multi-employer pension plan (“MEPP”) as a pension plan in which two or more employers participate and whose contributions are determined according to an agreement between the participating employers or a collective agreement, statute, or regulation. A MEPP does not include a pension plan where more than 95% of the plan members are employed by participating employers who are incorporated and are affiliates within the meaning of the Canada Business Corporation Act.

Negotiated contribution plans are MEPPs that include all of the following features:

  • at least one defined benefit provision,
  • a participating employer’s contributions are limited to an amount that is determined by an agreement entered into by the participating employers, a collective agreement, statute or regulation, and
  • the employer’s contributions are not linked to the solvency of the pension plan (i.e. the amount would not vary based on the funding requirements of the PBSA.