Waiver of annual allowance reduction

Can the reduction in your Annual Allowance be waived if your termination from the public service is involuntary?

Watch the video below to find the answer to this question and discover the circumstances under which you can request that the reduction in your annual allowance be waived.

Transcript of the Waiver of annual allowance reduction

If you are an indeterminate employee and are facing an involuntary retirement from the public service, there is a provision in the public service pension plan that allows for the waiver of the reduction to an annual allowance. This means that, if certain conditions are met, you may receive an unreduced pension payable immediately when you cease to be employed. Typically, this provision is used in workforce adjustment and layoff situations.

If you became a member of the public service pension plan on or before December 31, 2012, you may be eligible for the waiver, if on termination you are at least 55 years of age and less than age 60. However, if you became a plan member on or after January 1, 2013, to be eligible for the waiver, you must be at least 60 years of age and less than age 65. In addition, you must:

  • have two or more years of pensionable service to your credit;
  • have been employed in the public service for one or more periods totaling at least 10 years;
  • have chosen an annual allowance;
  • have the Deputy Head of your employing department or organization certify that you are eligible for the waiver; and
  • have not received an educational allowance.

In calculating the 10 years of public service employment, all your full-time service can be counted, regardless of whether or not it is to your credit. This may include:

  • Public service for which you did not contribute to the pension plan
  • Public service for which you received a return of contributions
  • Public service that was transferred to an outside employer
  • Public service for which a service buyback was finalized

If you have part-time service after 1980, it may be counted if at least some of that service was pensionable. Part-time employment prior to 1981 can be counted under certain conditions.

In the case of seasonal employment, the off-seasons are included in the calculation of the 10 year period. For example, a seasonal employee who regularly works six months in the year and who has been employed for 16 years meets the 10 year requirement, even though he only has eight years of pensionable service to his credit.

Some types of service are not included in the calculation of the 10 year period, such as service with the Canadian Forces, the Royal Canadian Mounted Police and service acquired as a result of a reciprocal or pension transfer agreement. Any periods of service purchased with the employer outside the public service, are also excluded from the calculation.

To obtain an estimate, or for more information regarding the waiver of an annual allowance reduction, please contact the Government of Canada Pension Centre.

Public Services and Procurement Canada

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