On March 3, 2011, the Ontario government released draft regulations regarding the division of pension assets on marriage breakdown.
The new regulations will require administrators to:
• provide a new type of calculation when a member (or their spouse) requests a statement of benefits
•adjust their systems and create processes to handle the new type of calculation
•update administration manuals to ensure compliance with the new regulations
•prepare communication materials that meet the requirements (utilizing forms not yet released).
The draft regulations require the immediate settlement of a claim by a separated spouse for both active and inactive plan members. The new rules have disposed of “if-and-when” arrangements that, in the past, deferred a settlement.
Under the new rules, plan administrators are responsible for the valuation of pension assets for family law purposes. Administrators are also responsible for managing the implementation of the settlement according to the legislation.
Public comments are invited up to April 18, 2011. The new rules may be proclaimed into force as soon as July 1, 2011.