Amending a simplified pension plan

Here are the rules that apply when amending a simplified pension plan (SIPP). 

Key considerations

  • The financial institution may amend, divide or merge the plan. It also has the power to terminate the pension plan or carry out the withdrawal of an employer.
  • A financial institution that decides to amend a pension plan must inform the employers concerned and the affected members.  

    It is not necessary to send a notice to plan members when a new employer joins the plan.

  • The employer can also, subject to any power-sharing agreement (where there is a union), have the plan amended or withdraw from the plan by instructing the financial institution to take the required steps. 

  • A financial institution that receives a notice concerning from an employer an amendment must inform the affected members in writing.

Restrictions regarding amendments that reduce benefits

Amendments reducing benefits, particularly those that limit plan eligibility or reduce the employer contribution, may not take effect prior to the 30th day following, as the case may be: 

  • the effective date of the collective agreement (or arbitration award, order or decree) under which the amendment was made
  • the date on which the notice of amendment was sent to the affected members.

However, the restrictions on the effective date do not apply in the following two cases:

Standard provisions

Where an amendment reducing benefits is carried out within the time frame provided for under the standard provisions and variations of the provisions, the same rules apply. However, our authorization is not required where the amendment reducing benefits has retroactive effect and the affected members give their consent.

Documents required

We can request the following from the financial institution:

  • the written consent of the affected members
  • proof of the date on which the notice was sent to the members or the effective date of the collective agreement, as the case may be.

The financial institution must retain those documents.

We can also request that the financial institution provide the affected members' contact information in order to carry out verifications.

Legal references

The Gouvernement du Québec publishes its Web pages in French. Consistent with the Charter of the French Language and to inform stakeholders outside Québec, this page is also published in English.
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