Group Retirement Plans

The new demographic and social realities, as well as the workforce shortage, compel employers and employees to realize the importance of establishing a group retirement plan.

This is mainly why the bill no. 39 on Voluntary Retirement Savings Plans (VRSP) was adopted by the National Assembly on December 3rd, 2014 and made its entry on July 1st, 2014. This law states that any company with five “eligible” employees or more will have to offer a group savings plan allowing payroll deductions. The deadline to comply with this new law varies according to the number of “eligible” employees at work:

 

20 and more
employees

December 31st, 2016, if they have 20 or more eligible employees on June 30th, 2016;

10 to 19
employees

December 31st, 2017, if they have 10 to 19 eligible employees on June 30th, 2017;

5 to 9
employees

The date determined by the government, which cannot be prior to January 1st, 2018, if they have 5 to 9 eligible employees.

Please refer to our VRSP memo for more details.

In order to facilitate the compliance to this new law for employers, the government created a new retirement product named the Voluntary Retirement Savings Plan (VRSP). This plan can be administered by an insurer, an investment fund manager, a trust company or a corporation described by law.

Group Censeo believes that this new product may be appropriate for some companies. However, depending on the size of your business, your needs and your goals, it may not suit you and create more administrative tasks than a standard group retirement plan (RRSP, DPSP, SPP, TFSA). In addition, the VRSP does not offer the same level of flexibility as other group retirement plans and some features have been withdrawn.

At Group Censeo, we use a personalized approach to assist you in this process and help you make the right decisions.

Our service proposal is summarized as follow:

Analysis of the client’s needs

  •  Understanding the client’s objectives considering the financial, legal, administrative and fiscal aspects;
  •  Establishing a choice of a plan adapted to the client’s needs:
    •  Group Registered Retirement Savings Plan (group RRSP);
    •  Deferred Profit-Sharing Plan (DPSP);
    •  Simplified Pension Plan (SPP);
    •  Group Tax Free Savings Account (group TFSA);
    •  Voluntary Retirement Savings Plan (VRSP).
  •  Establishing the contribution configuration and the plan parameters according to the objectives and nature of industry;
  •  Present efficient strategies of integrating an employer contribution to the plan.

Market analysis

  •  Verify the competitiveness of the proposed pricing and the different financial arrangements;
  •  Evaluate the management and administration services provided by the supplier, as well as the communication tools, the investment options and the financial stability;
  •  Preparation of a specifications book;
  •  Analysis of quotes and recommendation of a supplier;
  •  Evaluation of the costs and agreements of the proposed services;
  •  Choosing a service provider.

Implementation

  •  Establishing the implementation process;
  •  Training of administrators in order to facilitate the management of the plan and promote an effective implementation and an efficient continuous management;
  •  Scheduling information meetings and / or implementation seminars with employees.

Communication

  •  Establish means of communication in order to inform employees effectively and facilitate the administrator’s work;
  •  Development of bilingual communication tools;Establishment of practices promoting an effective and comprehensive usage of the plan;
  •  Establishment of practices promoting an effective and comprehensive usage of the plan;
  •  Annual information meetings with employees.

Follow-up

  •  Periodic revalidation of investment management fees according to the evolution of the plan’s assets;
  •  Guidance in the overall operation of the plan;
  •  Conduct periodically a market analysis to revalidate the investment management fees and confirm if the current provider continues to meet your requirements.