Withdrawal of an employer from a simplified pension plan

Situations involving the withdrawal of an employer

The employer decides not to offer the simplified pension (SIPP) plan any longer.

A decision by the financial institution to carry out the withdrawal of an employer (for example, in the event of the employer's bankruptcy).


Changing financial institutions by transferring the amounts accumulated in an SIPP to the SIPP of a new institution is not an employer withdrawal. Rather, it is an amendment that results in the division of the original institution's SIPP.

Procedure for withdrawing an employer

Step 1 - Notice of withdrawal

An employer withdrawing from an SIPP must give written notice to:

  • the financial institution administering the plan
  • the union, if any.

The financial institution must immediately inform:

  • the members affected
  • Retraite Québec.

Take into account the power-sharing agreement with the union, if any

An employer who withdraws must take into account such an agreement since it is an integral part of the SIPP text. For instance, the agreement may state that the employer's decision to withdraw from the SIPP must be made jointly with the union.

The financial institution which carries out the withdrawal of an employer must immediately inform:

  • the employer affected by the withdrawal
  • the union, if any
  • the members affected
  • Retraite Québec.

Step 2 - Statements and payment of benefits to members

The financial institution must send every member a statement of benefits accompanied by a note explaining that the benefits will be transferred within 60 days of sending the statement, based on the applicable method chosen by the member, or failing that, the financial institution.

The statements of benefits must be sent soon after the date on which the employer withdraws.

Withdrawing from an SIPP does not eliminate the employer's obligation to pay required contributions.

The financial institution must initiate the procedures necessary for recovering any contributions owed with interest.

If an employer is unable to pay the amounts owed (because of bankruptcy, for example), the financial institution will have to reduce the benefits of the members concerned.

Untraceable persons and Revenu Québec

If the financial institution is unable to send a statement of benefits to a member (for instance, documents sent have been returned or the person has moved leaving no forwarding address), the institution should contact Retraite Québec with a request to locate the person in question.

The request must be accompanied with the required fees and specify the following information about the member(s) concerned:

  • name
  • last known address
  • social insurance number
  • date of birth.

If Retraite Québec locates a member, it invites him or her to contact the financial institution that administers the SIPP.

Untraceable persons

If a member affected by the employer's withdrawal from an SIPP cannot be traced, all amounts owed to that member are transferred to Revenu Québec This link will open in a new window.. The transfer must be carried out 3 years after the time period for payment of benefits has expired.

Step 3 - Reporting to Retraite Québec regarding the payment of benefits to members

After paying benefits to members affected by the withdrawal of an employer, within 90 days following the last payment, the financial institution must report to Retraite Québec regarding that payment. For that purpose, the institution must produce an attestation signed by a qualified person affirming that all the benefits paid were the amounts which could be claimed by those affected by the employer's withdrawal and that the payments were made in conformity with the Supplemental Pension Plans Act.

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