9. Retirement

Steps to Help a Member Retire

The following resources are available to members to help them make decisions about their retirement.

Step 1 – Retiring in Three to Five Years
The decisions members make at retirement can impact the amount of their HOOPP pension, as well as the benefits they will receive from government programs, like the Canada Pension Plan and Old Age Security. HOOPP provides various resources and personal support to assist members who are seeking information about retirement planning.

To help members become familiar with their options please refer your members to the HOOPP retirement booklet, Planning for Retirement. This booklet and additional information are available on hoopp.com. These sources help members to understand key features of their pension including their survivor options, choosing a retirement date, early retirement, and the retirement process. In addition, by registering for HOOPP Connect, members can access the Pension Estimator to estimate their future pension using up-to-date information and they can compare different retirement ages and scenarios, including retiring early or later, changing their future work schedule (e.g. from full time to part-time or vice versa) and any future salary increases.

HOOPP’s Member Services team is available to help members make informed choices about their HOOPP pension, consistent with their personal situation.

Step 2 – Member Meetings
You should contact your Regional Manager to discuss member education opportunities tailored to your needs. Member education sessions are available to help members learn more about how their pension works and other topics. Members are encouraged to visit hoopp.com/pensionseminars for more information and to register.

Step 3 – Pension Estimates
HOOPP offers pension estimates for members available through the Pension Estimator on HOOPP Connect or by calling Member Services directly. The estimate provides a projection of how much pension the member will receive at specified future retirement date(s) based on certain assumptions.

Important

If the member is enrolled in HOOPP at more than one employer, they need to inform all of their employers about their retirement if they wish to begin their HOOPP pension. Employees must end their employment with all their employers to start receiving their HOOPP pension.
However, there are limited exceptions. A member may continue to work and receive a HOOPP pension without ending their employment with a part-time employer where: they did not enroll in HOOPP, or where they enrolled and then waived contributions in HOOPP. For more details, please see section 3.3 Part-time Employees (Click Here).

Step 4 – Retirement Notice
Submit a Retirement Notice event through HOOPP Insight to inform HOOPP of a member’s intention to retire.

The Retirement Notice can be processed as early as 120 days before the member's retirement date. HOOPP will contact members directly to advise them of their pension options and obtain payment instructions.

A member's pension will start on the first day of the month following the retirement date selected on the Retirement Notice. For example, if a member elects to retire on May 31, 2022 and has provided HOOPP with all the required information and any additional documents requested, they will receive their first pension payment on June 1, 2022.

Severance packages and termination notice periods may affect a member‘s retirement date. For more information about termination and severance packages please refer to Contributions on Termination Payments in section 4.7 Contributions in Other Situations (Click Here).

TIP

HOOPP occasionally receives a Termination Notice, rather than a Retirement Notice, for a member who is age 55 or older when they cease employment. Before submitting the event to HOOPP, be sure to ask whether the member intends to start receiving pension payments immediately. If so, submit a Retirement Notice on Insight.

We caution employers against engaging in re-employment arrangements with HOOPP members for the primary purpose of enabling employees to access their HOOPP benefit. For more information refer to section 8. Termination (Click Here).

Step 5 – Retirement Final Data
When submitting Retirement Final Data information for retiring members, use the appropriate reporting method in HOOPP Insight. This information may be reported by initiating a Retirement Final Data event or submitting an Events Final Data data collection.
The purpose of submitting the Retirement Final Data to HOOPP is to provide the following information:

  • Employment End Date

  • Final weeks and contributions

  • Pension Adjustment

  • Annualized earnings (if member completed a contribution waiver prior to January 2013)

  • Leaves of absence (if applicable)

  • Contributory leaves (if applicable)

  • Retroactive contributions (Important! Retro contributions should be provided to HOOPP through the Remittance process before you submit the final data)

Retirement Final Data information is required to be submitted immediately after the member's final payroll information is available so that HOOPP can calculate the member’s pension entitlement.

Important

Never estimate final weeks and contributions. All information reported to HOOPP when the final retirement data is submitted is final and binding and is used by HOOPP to calculate a member’s pension. Errors in reporting this information will result in the payment of an incorrect pension amount. If, however, the member's final weeks and contributions are known when the Retirement Notice is ready to be submitted, please submit the Retirement Final Data at the same time as the Retirement Notice.

For most HOOPP members, final weeks and contributions information cannot be determined until the member has completed their last day at work and final payroll information is available. This should not, however, delay you from initiating the Retirement Notice through HOOPP Insight.

When providing contributions data for a member who has received a retroactive pay settlement for a previous year, HOOPP contributions for each of the years relating to the settlement must be reported separately from regular contributions. Retroactive pay is considered to be an adjustment to earnings for a prior calendar year. Any adjustment to the current year is not considered to be retro for the purposes of calculating the contributions and should be reflected in the current year's contributions.

When completing the information for leaves and temporary periods of reduced earnings/approved work schedule reduction in the current year, please keep the following in mind:

  • Deemed earnings represent the difference between what the member would have earned if the member worked as scheduled during the leave/period, and their actual earnings during the leave period

  • If the employee works part-time, base the deemed earnings on the average weekly earnings received by the member during the 10 week period prior to the leave

For more information about leaves and temporary periods of reduced earnings/approved work schedule reduction, please see Temporary Periods of Reduced Earnings in section 4.7 Contributions in Other Situations (Click Here).

Reporting a Retirement Where the Last Pay is Received in the Following Calendar Year

Where an active member elects to retire near the end of calendar year, it is possible that a portion of their regular earnings for that year may be included in the first payroll period for the following year. For example, a member retires December 31, 2021 and a portion of their contributory earnings for late December is received in 2022, as part of the first payroll cycle for that year.

Even though the member’s T4 earnings are based on when the pay is received by the member, it is appropriate in this unique situation to determine the HOOPP contributions with reference to the member’s contributory service in 2021, including the portion of such earnings payable in 2022. This may require you to adjust the final-pay contributions remitted to HOOPP for 2021 and to submit this information with the Retirement Final Data. HOOPP cannot receive any contributions for a period after the member’s retirement date.

Once this information is received, HOOPP will adjust the record for the member accordingly. For information pertaining to reporting retroactive payments for a retired member please refer to section 4.5 Retroactive Pay (Retro) (Click Here) for details.

Checking Calculations

Before submitting the final retirement data and any information about contributions on retroactive settlements, you should check your calculations to ensure they are reasonable. The following formula will give you an idea of the accuracy of the member's annualized earnings for their last year or two on the job. This formula should also be used if you are providing annualized earnings for an inactive member.

Step 1: Determine the member's earnings for the current year (using regular contributions only – 2022 contribution rates are referenced below):

[low contributions ÷ .069] + [high contributions ÷ .092] = earnings for current year

Step 2: Determine the member's estimated annualized earnings:
[earnings for current year ÷ contributory weeks for current year] × 52 = estimated annualized earnings

Step 3: Check for Discrepancies

Check the estimated annualized earnings calculated in Step 2 against the member's annualized earnings for the previous year. To calculate the member's annualized earnings for the previous year, refer to the contributory weeks, contributions, and retroactive pay reported on the most recent HOOPP annual Member Data Collection. If there is an increase in annualized earnings of more than 15% or a decrease of $2,500 or more, you will be asked to provide a reason for the variance when the Retirement Final Data is submitted to HOOPP.

Step 6 – Once a Retirement Notice is submitted to HOOPP

Once HOOPP receives the Retirement Notice, the member will receive a benefits package outlining their options

Cancelling a Retirement Application

If a member changes their decision to retire and wishes to cancel their application, they can only do so before their pension payments begin. If the employee does not want to immediately start their pension, please submit a Termination event. Changes or adjustments to a retirement date must be reported to HOOPP by the employer not the member. Please contact HOOPP if a previously reported retirement date should be revised.

Member Retirement Checklist

Remember to:

✔ Refer members who are eligible to retire to HOOPP’s Planning for Retirement booklet and hoopp.com to help them understand key features of their pension

✔ Remind members to access their HOOPP Connect account before they plan to retire to:

  • Obtain HOOPP pension estimates to help them select a retirement date that suits their individual circumstances

  • Ensure HOOPP contact information is up to date

  • Ensure HOOPP has information about any qualifying spouse, including the spouse’s date of birth

  • Ensure beneficiaries are up to date, even if member has a qualifying spouse

  • Encourage members to request a pension estimate via HOOPP Connect to help them select a retirement date that suits their individual circumstances

✔ Provide members with access to member education either in a group by attending a HOOPP retirement planning seminar/webinar or through individual discussion

✔ Process the Retirement Notice up to four months before the retirement date

✔ Check calculations

✔ Process the final retirement data after final payroll information is available

Re-enrolling in the Plan after Retirement

Retired HOOPP members can, upon returning to work with a HOOPP employer, choose to temporarily stop their pension and resume contributions to the Plan. If they choose to do this, their pension will be recalculated when they start receiving it again.

If the retired member is interested in re-enrolling, they will need to complete a Re-enrolment Estimate Request Form to get an estimate from HOOPP that shows how their pension will be affected if they temporarily stop receiving it and resume contributions to the Plan. Members are encouraged to review the Working After Retirement section of hoopp.com and to contact Member Services to understand which choice would be the most beneficial and attractive to them.

If the member informs you that they have decided to suspend their pension, you will be required to initiate an enrolment event in HOOPP Insight. For more information, see section 3.4 Retired Members (Click Here).

We caution employers against engaging in re-employment arrangements with HOOPP members for the primary purpose of enabling employees to access their HOOPP benefit. For more information refer to section 8. Termination (Click Here).

Current as of May 17, 2024