Questions & Answers Regarding a Transitory Provision – Phased Departure (2016-06)
The minister responsible for Government Administration and Ongoing Program Review and Chair of the Conseil du trésor, M Carlos J. Leitão, tabled in the National Assembly, on May 11, 2016, bill no 97
This bill no 97, assented on June 8, 2016, modifies the retirement eligibility criteria for members of the Government and Public Employees Retirement Plan (RREGOP) and the Pension Plan of Management Personnel (PPMP), who must complete the additional period of membership of 5 years, but cease participation to the plan before the end of that period.
Amendments to the following eligibility criteria for an immediate pension without reduction will take effect on July 1, 2019:
- Increase of the age criteria from 60 years old to 61 years old;
- Addition of a new criteria, that is, criteria 60 years old with a 90 eligibility factor (age + service for eligibility purposes).
Note that the criteria 35 years of service for eligibility to an immediate pension without reduction is maintained.
Furthermore, the reduction due to anticipation of the immediate pension will increase from 4% to 6% per year of anticipation starting on July 1, 2020. The immediate pension is usually payable to the member of a pension plan as soon as the day following the date of end of membership to the pension plan.
Given the amendments that will be made to the retirement eligibility criteria, the bill provides for a transitory provision in regard to phased departures (progressive retirement) that started before May 11, 2016 and those who will start during the period from May 11 2016 to September 7, 2016, inclusively.
Phased departure is a measure allowing you to reduce your number of work hours before you retire, without reducing the service and salary usually recognized by your pension plan. In order to be valid, the agreement must respect the following conditions:
- It must last at least 1 year but no more than 5;
- For each year of agreement, your new work schedule cannot be less than 40% of the normal work period for full-time equivalent employment.
To benefit from a phased departure agreement, you must be eligible for retirement at the end of the agreement. The form Application for Confirmation of Eligibility for Phased Departure (267A - this form is available in French only), available on our website, will confirm your eligibility to a pension at the end of the agreement.
1. Which retirement eligibility criteria will apply if my phased departure agreement began before May 11, 2016?
If the phased departure agreement began before May 11, 2016, the current retirement eligibility criteria will apply at the end of your agreement, in accordance with the Act Respecting the RREGOP:
- 60 years old;
- 35 years of service for eligibility;
- 55 years old (reduction rate of 4% a year due to anticipation).
These criteria will also apply if you participate in the Pension Plan of Management Personnel (PPMP) and did not complete your additional period of participation of 5 years at the end of the agreement.
2. What will be the retirement eligibility criteria that will apply if my phased departure agreement begins during the period from May 11, 2016 to September 7, 2016?
The current retirement eligibility criteria provided by the Act Respecting the RREGOP will apply at the end of your agreement. To that end, in addition to the general conditions required to benefit from a phased departure agreement, you must comply with the following conditions:
- Your phased departure agreement begins during the period from May 11, 2016 to September 7, 2016;
- Your work schedule is reduced by at least 20% of the normal schedule for full-time equivalent employment, and this, for each year of your phased departure agreement.
The current retirement eligibility criteria provided by the Act Respecting the RREGOP are the following:
- 60 years old;
- 35 years of service for eligibility purposes;
- 55 years old (rate of reduction of 4% per year due to anticipation).
These criteria will also apply to you if you participate in the Pension Plan of Management Personnel (PPMP) and did not complete your additional participation period of 5 years at the end of the agreement. Your agreement must also comply with the conditions listed previously.
2.1. What will happen if my phased departure agreement begins during the period from May 11, 2016 to September 7, 2016 and my work schedule is not reduced by at least 20% of the normal schedule for full-time equivalent employment?
The bill does not provide any transitory provision for a phased departure agreement beginning during the period from May 11, 2016 to September 7, 2016 and for which the work schedule is not reduced by at least 20% of the normal schedule for full-time equivalent employment. Therefore, it is the retirement eligibility criteria in effect at the end of your agreement which would apply.
2.2. If I work part-time, what percentage of my work period should be reduced in order for me to benefit from the transitory provision?
If you work part-time, you must comply with the following conditions to benefit from a transitory provision:
- Your work schedule must be reduced by at least 20% of the normal schedule for equivalent full-time work.
- Your work schedule must not be less than 40% of the normal schedule for equivalent full-time work.
You must comply with these conditions for each year of your phased departure agreement.
Example 1
Before you begin your phased departure, your percentage of time worked is 75%.
In order to comply with the conditions previously mentioned, your percentage of time worked should correspond to a maximum of 55% and a minimum of 40% of the normal schedule for equivalent full-time work, and this, for each year of the agreement.
Exemple 2
Before you begin your phased departure, your percentage of time worked is 50%.
In order to comply with the condition that your work schedule must be reduced by at least 20%, your percentage of time worked during the agreement should be a maximum of 30%.
However, that percentage does not comply with the condition that your work schedule must correspond to at least 40% of the normal schedule for equivalent full-time work.
Therefore, you will not be able to benefit from the transitory provision. In order to avail yourself of the provision, your work schedule should represent at least 60% of the normal schedule for equivalent full-time work before the beginning of your phased departure.
3. What will be the retirement eligibility criteria that will apply if my phased departure agreement begins after September 7, 2016?
The bill does not provide any transitory provision for a phased departure agreement beginning after September 7, 2016. This means that it will be the retirement eligibility criteria in effect at the end of your agreement that will apply.
4. What do I have to do if I wish to benefit from a phased departure agreement?
It is important to specify that it is up to your employer to allow you to enter into a phased departure agreement (progressive retirement) and to determine with you the terms of that agreement.
Consequently, if you wish to benefit from a phased departure agreement (progressive retirement), you must first meet with the person responsible for the pension plan administration at your employer, usually at the human resources department.
The form Application for Confirmation of Eligibility for Phased Departure (267A - this form is available in French only), available on our website allows you to get a confirmation of your eligibility to a retirement pension at the end of the agreement.
5. Does the transitory provision affects only phased departure agreements?
Yes, it only affects phased departure agreements.
6. When will you determine which retirement eligibility criteria will apply to my situation?
When you apply for your retirement pension, we will verify if retirement stems from a phased departure agreement relevant to the transitory provision. If need be, we will require the necessary proof. We will then examine the retirement eligibility criteria that must apply depending on the situation.
For more information on the transitory provision regarding phased departure, you can talk to your employer or contact Retraite Québec.
To find out the details of other legislations, consult bill no 97 on the National Assembly's website.
You can send us the form Application for Confirmation of Eligibility for Phased Departure (267A - this form is available in French only) by the following mean of communication:
By fax
418 644-8659