About this directive
Reference to applicable legislation (act or regulation): | Employment Pension Plans Act and Regulations Joint Governance of Public Sector Pension Plans Act Public Service Pension Plan (Plan Text) Public Sector Pension Plans Act Public Sector Pension Plans (Legislative Provisions) Regulation Management Employees Pension Plan Regulation Part 2, Section 13, 39, 40, 41, 49, 55, 56, 57, 66, 98, Part 17, Public Service Employment Regulation Article 4, 16, 17, 18, LOU 3, 4, 5, 22, Collective Agreement |
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Application: | All employees appointed or employed pursuant to the Public Service Act |
Last updated: | February 2022 |
Last reviewed: | February 2022 |
Amended by: | Alberta Public Service Commission: Strategic Services and Public Agency Secretariat, Workforce Policy, Pension and Benefits Policy |
Purpose
This directive provides consistent and transparent rules for the application of the Public Service Pension Plan (PSPP), Management Employees Pension Plan (MEPP), and Management Supplementary Retirement Plan (SRP) to employees subject to the Public Service Act (PSA).
Overview
This directive outlines the Government of Alberta's rules, as related to pension membership, pensionable salary and calculating pensionable service under the PSPP, MEPP and SRP. These rules will be applied fairly and consistently throughout the Government of Alberta.
Definition of terms
Disclaimer: If there are any discrepancies in how the terms are defined below and the Public Service Act and Public Service Employment Regulation (PSER), the act and regulation supersede.
The following terms identified in this directive have the same meaning described in the Pension Membership Policy: Part-time, Temporary and Fixed Term Contract Employees.
Terminology related to types of employment are consistent with those identified in the PSER.
Participation in PSPP or MEPP
Pension participation for employees of the Government of Alberta is in either PSPP or MEPP (including the SRP).
MEPP (and SRP) participation applies to employees in the following categories:
- employees holding a position that is classified or designated as a management position, according to the PSER
- certain employees who are grandfathered to participate in MEPP pursuant to section 10(1)(o) of the Management Employees Pension Plan (AR 367/93) Regulation – in particular: employees who are, or were, a MEPP participant by virtue of holding a position in another eligible category at any time from September 1, 2019 to January 1, 2023 and who, during that period, are either:
- reclassified to a position to which PSPP otherwise applies, or
- on the initiative of the Government of Alberta, are appointed to another position in the Government to which PSPP otherwise applies (except if resulting from a disciplinary action or the Government’s common law duty to accommodate), and provided their employment is continuous through the reclassification or re-appointment, and participation continues only for so long as their employment remains continuous in the reclassified position or position to which they were appointed.
For more information on eligibility for grandfathered participation in MEPP, see the MEPP Grandfathering Guidelines.
All other Government of Alberta employees eligible to participate in a pension plan (pursuant to the other rules listed as 1 and 2 above) participate in PSPP.
Exclusions
Notwithstanding the above, pension plan participation is not permitted if an employee:
- works less than 14 hours per week or 728 hours per service year, or
- after an employee reaches his or her latest pension commencement date (December 31 of the year in which the member turns 71 years of age), or
- is in receipt of a pension from the PSPP, MEPP or the Public Service Management (Closed Membership) Pension Plan, based on previous participation in any of those plans.
Pension plan membership
Pension plan participation will commence immediately upon the first date of employment for eligible employees. Eligibility for pension plan participation for part-time, temporary and fixed term contract employees is set out in the Pension Membership Policy – Part-time, Temporary and Fixed Term Contract Employees.
Pensionable salary
The following represent the types of salary which are pensionable (list is not exhaustive):
- gross basic annual salary, including salary associated with entitlements, for example:
- General Illness
- Long Term Disability Income (LTDI)
- Supplemental Employment Benefits
- salary modifiers, such as acting incumbent pay and others
- premium pay, such as shift differential for working nights and weekend premium for working weekends
- retroactive salary adjustments
The following represent the types of salary, which are non-pensionable salary types (list is not exhaustive):
- overtime
- standby pay
- vacation leave payout
- expense allowance payments (for example: meal allowances)
- non-cash benefits
Pensionable service
Pension plan reporting (service) year
For the purposes of calculating service year for pension purposes, a bi-weekly pay schedule is used. The pension “service year” begins the first day of the first pay period of the calendar year and ends on the last day of the final pay period of the calendar year.
Pensionable service
Pensionable service is calculated on a daily basis by determining the number of days an eligible employee worked in a pension plan reporting year as compared to the total possible number of working days within a pension plan reporting year.
The weekly hours used in the calculation of pensionable service are set out in accordance with the Public Service Employment Regulation or Collective Agreement and shall be either:
- 40 hours per week, or
- 38.75 hours per week, or
- 36.25 hours per week
Part-time equivalents are calculated as a percentage (%) of the full-time equivalent as outlined above.
Pensionable service – Maximum pensionable service accrual
Pensionable service earned within a service year will not exceed one year of service under the pension plan.