TABLE OF CONTENTS - IWA Forest Industry Pension Plan

TABLE OF CONTENTSOVERVIEW ................................................................................ 3About this Booklet ......................................................................... 3MEMBERSHIP IN THE PLAN ....................................................... 4Joining the Plan ............................................................................ 4Changing Jobs .............................................................................. 4Your Pension Record ...................................................................... 4PENSION BASICS ...................................................................... 5What is a Pension? ........................................................................ 5What type is this Plan?................................................................... 5How does the Plan work? ............................................................... 5BUILDING YOUR PENSION ........................................................ 6Contributory Hours ........................................................................ 6Unfunded Hours ............................................................................ 7Excess Hours ................................................................................ 8Partial Year’s Credit ....................................................................... 8Break in Service............................................................................ 8Active and Inactive Plan Member ..................................................... 8Your Accrued Pension .................................................................... 8Benefit Rates ................................................................................ 9The $35 rate ......................................................................... 9The $40 rate ....................................................................... 10The $50 rate ....................................................................... 10The $60 rate ....................................................................... 10Other benefit rates .............................................................. 10PROVISIONS FOR DISABLED MEMBERS .................................. 11Definition of Disability .................................................................. 11Definition of Disabled ................................................................... 11Definition of Permanently Disabled ................................................ 11Proof of Disability ........................................................................ 12Eligibility for Disability Credits ....................................................... 12Disability Credits ......................................................................... 12Disabled but Not Eligible for Disability Credits ................................. 13Benefit Rate for Members Eligible for Disability Credits ..................... 13Shortened Life Expectancy ........................................................... 14DEATH BEFORE RETIREMENT .................................................. 15Amount of Death Benefit .............................................................. 15Recipient of Death Benefit ............................................................ 15How the Benefit is Paid ................................................................ 161

LEAVING YOUR JOB ................................................................ 17Break in Service .......................................................................... 17Vesting ...................................................................................... 17Benefits ..................................................................................... 17Break in Service for Vested Plan Members Prior to Age 55 ................. 18Transfer Deficiency ...................................................................... 19Returning to Work ....................................................................... 19Transfer to a Salaried Job ............................................................. 19Owner/Operator .......................................................................... 20Leave of Absence ........................................................................ 21Involuntary Job Loss .................................................................... 21Definition ............................................................................ 21Upgrade to Active Status ....................................................... 21Plan Members who have an Involuntary Job Loss ...................... 22The Two-for-One Rule ........................................................... 22COMMUTED VALUE AND TRANSFER OPTIONS ......................... 24Transfer Options ......................................................................... 24Examples of Approved Investment Vehicles are: .............................. 24RETIREMENT........................................................................... 25Applying for a Pension .................................................................. 25Retiring as an Active Plan Member ................................................. 25Early Retirement Reductions for Active Plan Members ....................... 26Latest Retirement Date ................................................................ 26Retiring as an Inactive Plan Member .............................................. 26Pension Adjustments for Inactive Members: .................................... 27Options for the Payment of your Pension ........................................ 27Joint and Survivor Pension ............................................................ 27Life Pension with and without Guarantee Period ............................... 28Supplemented Early Retirement Option .......................................... 28FURTHER INFORMATION ........................................................ 29Divorced or Separated Members .................................................... 29If you Return to Work After Retiring ............................................... 29Sources of Retirement Income ...................................................... 30For more information ................................................................... 312

OVERVIEWThe IWA ‐ Forest Industry Pension Plan (the “Plan”) was created in 1978by the merger of three regional pension plans which were established in1973. The Plan is governed by a Board of Trustees, half of whom areappointed by USW, and half by Forest Industry employer associations.The Plan is administered by the staff of the IWA ‐ Forest Industry PensionPlan Office (the “Plan Office”).The Plan is designed to be an important part of your financial security inretirement, along with government benefits you may be entitled to, aswell as your personal savings. The amount of pension you receive isbased on your years of credited service and the contributions you andyour employer contribute to the Plan.Active Plan Members may retire before age 65 under the Plan’s subsidizedearly retirement program. Under this program you may receive 100% ofyour pension as early as age 60. If you choose to retire before age 60 asan Active Plan Member, you will also qualify for the subsidized earlyretirement benefits. The basic pension is one which is paid monthly foryour lifetime, with a guarantee that at least 60 monthly payments will bemade. There are other pension options available for you to choose whichmay provide a greater or lesser benefit to you and your survivor. If youhave a spouse at retirement, you are required by law to elect survivorcoverage for your spouse unless he or she waives that right.If you stop working for a participating employer and break service beforeage 55, you will become an Inactive Plan Member. You will be entitled toreceive a full pension benefit at age 65, or a reduced pension payable asearly as age 55. You may also choose to transfer the present value ofyour accrued pension benefit to another retirement plan.If you are vested and die before retiring, either while an Active PlanMember or an Inactive Plan Member, the Plan will pay a death benefit.About this BookletThis booklet is a summary of the terms of the Plan as of January 1, 2008.If anything in this booklet is inconsistent with the terms of the official PlanText, the terms of the Plan Text always govern.Copies of the official PlanText are available for yourinspection at the Plan Office,offices of participating employersand union localsduring regular businesshours.3

The Pension Plan requires a“Designation of Beneficiary”card signed by you. Thisform is not the same formyou use to change yourbeneficiary with your employer,union, or any otherbenefit plan.MEMBERSHIP IN THE PLANJoining the PlanYou become a Plan Member when you become a bargaining unitemployee of an employer that participates in the Plan. Yourmembership in the Plan begins as soon as you start a job covered by aUSW collective agreement, whether you are a full-time, probationary orcasual employee.You are required to complete an Enrolment Card and a Designation ofBeneficiary Card when your employer registers you with the Plan.Changing JobsYour membership in the Plan and your earned pension credits are notaffected if you change from one employer to another within the ForestIndustry, provided each of your employers participates in the Plan.Your Pension RecordEmployers provide the Plan Office with most of the information neededto keep your record up to date. However, it is your responsibility toensure the information is correct.If the Plan Office has your current address, you will receive an AnnualStatement every year. Check your statement carefully to make sureyou have received all of your credits. It is also important to makecertain your personal information is correct, including a beneficiarydesignation. If you have questions, or if you believe information onyour statement is incorrect, please contact the Plan Office.4

PENSION BASICSWhat is a Pension?As a USW member, you participate in a plan that will provide you with apension – a monthly, lifetime income – after you retire from work. Thispension is an asset, just like a house or boat or other property.Pension plans come in two basic types:• A defined benefit plan, which provides a pension based on a benefitformula tied to the plan member’s years of service; or• A defined contribution plan, which provides a pension based oncontributions made by the plan member and his or her employer, andthe income earned from the investment of those contributions.The advantage of a defined benefit pension plan is that it provides apredictable monthly benefit at retirement based on a formula of age,service and benefit levels; whereas, the monthly benefit available from adefined contribution plan is subject to fluctuation because of variableinvestment returns.MembershipYou are an Active Plan Memberwhile you are:• working and contributionsare made to the PensionPlan; or• collecting disability benefits;or• out of work up to yourbreak in service date.You are an Inactive PlanMember when:• you leave your benefitwith the Plan following abreak in service.Once you retire and begin tocollect your pension, youbecome a Retired Member ora Pensioner.What type is this Plan?The IWA - Forest Industry Pension Plan is a negotiated cost definedbenefit plan, where your pension is based on the number of years ofservice you accrued as a Plan Member and the benefit rate that applied toyour service. The benefit available to you at retirement is not primarilydependent on the investment performance of the Plan’s assets. As youprepare for retirement, you can project or estimate the amount ofmonthly pension you may receive.How does the Plan work?The Plan will pay you a lifetime pension, starting when you retire. Afteryour death, depending on what kind of pension option you choose atretirement, the Plan may continue to pay pension benefits to your spouse(if you have one) for his or her lifetime. The Plan may also pay a pensionbenefit to your beneficiary for the remainder of a guaranteed period, or alump sum payment to your estate.5

For the Pension Plan…“spouse” means:• the person you are legallymarried to and, forthe two-year period immediatelybefore the relevanttime (e.g., retirementor death), were not livingseparate from; or, if thisdoes not apply,• the person, of the sameor opposite sex, who haslived with you in a marriage-likerelationship forthe two‐year period immediatelybefore the relevanttime.Example• If you accrue 1,500 coveredhours, you earn afull year of service.• If you accrue 1,050 coveredhours, you earn .7 ofa year of service.• If you accrue 750 coveredhours, you earn .5 of ayear of service.BUILDING YOUR PENSIONYour basic pension is calculated by multiplying your years of creditedservice by the benefit rate(s) that applied to each year. When you accrue1,500 covered hours in one calendar year, you earn a full year of creditedservice. If you accrue less than 1,500 hours, you will earn a partial year’scredit.Covered hours include:Contributory Hours• contributory hours• unfunded hours• excess hoursContributory hours are hours for which you and your employer contributeto the Plan. They include:Work: All hours you work. Overtime hours are credited as straight time.Apprenticeship: When you attend courses and your salary continues tobe paid by your employer, contributions are required.Pregnancy Leave: Both you and your employer will pay contributionsfor up to 18 weeks, or longer with a doctor’s certification, while onpregnancy leave.Parental Leave/Bereavement Leave/Compassionate Care Leave/Family Responsibility Leave/Jury Duty Leave: You have theoption of continuing your coverage by paying your contributionsduring this leave. Your employer must pay contributions on yourbehalf if you pay your portion to your Employer.Forest Fires: Hours you spend fighting a forest fire that is theresponsibility of your employer are considered hours worked.Alternate Work Schedule or Compressed Work Week: USW andyour employer may have a letter of understanding that outlines thehours you are to work and contributions payable for those hours.Arbitration Awards: If you are awarded compensation as the result of asettlement or an arbitration of a grievance, contributions are requiredfor up to 40 hours per week.6

Unfunded HoursUnfunded hours are hours for which no contributions are required. Ifyou did not work 1,500 hours in a year, you may be eligible to receiveadditional credit in the Plan. You receive credit for unfunded hours onlyif you have less than 1,500 contributory hours in a year.Unfunded hours may be credited for the following:Disability: If you are ill or injured, and in receipt of wage loss, weeklyindemnity or LTD benefits, you will receive credit.Layoff: If you work full-time and are laid off for more than fiveconsecutive workdays, you receive credit for 40 hours for each 5day work period. You are eligible to receive a maximum of 200hours (5 weeks) in any calendar year. However, only 200 hoursin any two-year period can be used to prevent a break in service.Permanent Closure: If you lose your job because of a permanentclosure, you are credited with 200 unfunded hours, less any layoffhours you may have already received for that year.Vacation: If you are eligible for more than five weeks of vacation ayear, you receive 40 hours of credit for each week after the fifthweek.You will receive credit for only the number of unfunded hours requiredto give you a full year of service (1,500 hours).Your employer is responsible for reporting periods you were unable towork, such as periods of disability or layoff. They are also responsiblefor reporting vacation time in excess of five weeks. If you have lessthan 1,500 covered hours in any year, you should verify that you havereceived all the unfunded hours to which you are entitled when youreceive your “Annual Statement”.RememberCheck your “Annual Statement”to make certain allhours you worked are recorded.7

ExampleYou have accumulated morethan 1,500 excess hours andplan to retire January 1,2009.Your excess hours will beused to provide you with afull year of credited servicefor 2009. Additional excesshours cannot be used.Excess HoursIf you work more than 1,500 contributory hours in a year, the hoursover 1,500 are recorded as excess hours. Excess hours accumulateover time. In years when you are an Active Plan Member and yourcontributory hours and unfunded hours are less than 1,500, excesshours you accumulated in prior years will be used to bring your total forthe year up to (or as close as possible to) 1,500.Excess hours can also be used to increase your credited service if youwork less than 1,500 hours in the year you retire.Partial Year’s CreditExcess hours may not becarried over for use in anycalendar year after a breakin service or after you retire.Example1,500 hours = 1 yr of service1,050 hours = .7 yr of service750 hours = .5 yr of serviceIn years when you are unable to accumulate 1,500 hours, you willreceive a partial year’s credit.Break in ServiceYou break your service when you fail to work, or otherwise accumulate,350 qualifying hours in two consecutive calendar years. The hours thatqualify are:• all contributory hours;• all unfunded hours relating to disability; and• a maximum of 200 unfunded hours relating to layoff or permanentclosure in the two consecutive calendar years.Excess hours cannot be used to prevent a break in service.You break your service on December 31 st .Active and Inactive Plan MemberYou are an Active Plan Member if you have not broken service since youlast joined the Plan. You are an Inactive Plan Member if you had abreak in service after you were vested. After a break in service youmay return to work with a participating employer and become an ActiveMember of the Plan again. Only the service you earn after your returnwill be considered active service.Your Accrued PensionYour earned pension is equal to your years of credited service multipliedby the pension benefit rate that applies to each year of credited service.8

Benefit RatesThe benefit rate applicable to each period of your credited service isbased on the contribution rate paid by you and your employer. Formost Active Members, the benefit rate is:• $35 per year for credited service up to July 1, 1993;• $40 per year for credited service after July 1, 1993 and prior toJanuary 1, 2001;• $50 per year for credited service after January 1, 2001 and prior toJanuary 1, 2003; and• $60 per year for credited service after January 1, 2003.Lower benefit rates may apply if you and your employer were not payingcontributions at the maximum required rates. The relationship betweenthe contribution rate and the benefit rate is summarized below.RememberAn “Active Plan Member”means you have not brokenservice in the Plan.What benefit rate applies tocredited service earned withunfunded or excess hours?Generally, you will receivethe same benefit rate whichapplies to hours worked foryour most recent employer.The $35 rateThe benefit rate is equal to $35 per year of credited service when youremployer contribution is $2.40 an hour, and you make no contributionsto the Plan. The $35 benefit rate also applies to all of your creditedservice earned during your most recent period of active Planmembership if ANY of the following apply to you:1. a) You were an Active Plan Member (i.e. working or laid off)on June 30, 1991; andb) your employer on June 30, 1991 contributed $2.40 an hourto the Plan on July 1, 1992, or at a later date acceptable tothe Plan’s Trustees.OR2. a) You were an Active, but unemployed, Plan Member onJune 30, 1991; andb) your last employer prior to June 30, 1991 contributed $2.40an hour to the Plan on July 1, 1992, or at a later dateacceptable to the Plan’s Trustees.OR3. You were an active employee of an employer on the date theemployer began contributing $2.40 per hour to the Plan, providedthe employer contributed $2.40 per hour prior to July 1, 1998.9

The $40 rateThe benefit rate is equal to $40 per year of credited service when youcontribute 10 cents to the Plan and your employer contributes $2.40 anhour to the Plan. The $40 rate can only apply to service earned afterJune 30, 1993.The $50 rateThe benefit rate is equal to $50 per year of credited service when youand your employer contribute a total of $2.775 an hour to the Plan. The$50 rate can only apply to service earned after January 1, 2001.The $60 rateBenefit RatesIf you are unclear as towhich benefit rate applies toyour service, please contactthe Plan Office.The benefit rate increased to $60 per year of credited service for periodsafter January 1, 2003, if both you and your employer contributed at themaximum required contribution rate.Other benefit ratesEach time you break service, your pension rate is frozen at the rate thatapplied at the time of the break. The historical benefit rates of the Planare:DateBenefit RateJuly 1, 1973 $3July 1, 1975 $9July 1, 1977 $10July 1, 1979 $15July 1, 1983 $20July 1, 1986 $25July 1, 1988 $32July 1, 1991 $35July 1, 1993 $40 (1)January 1, 2001 $50 (2)January 1, 2003 $60 (3)(1) Can only apply to service after July 1, 1993(2) Can only apply to service after January 1, 2001(3) Can only apply to service after January 1, 200310

PROVISIONS FOR DISABLED MEMBERSIf you were employed in a bargaining unit job when you becamedisabled, the Plan will, in most cases, continue to maintain your activestatus. You will receive credited service only if you are receivingdisability benefits.Please note: The provisions for disabled Members described in thissection apply to most, but not all, Plan Members. Pleasecontact the Plan Office if you are unsure of your status.Definition of DisabilityDisability coverage is provided to Plan Members who qualify under thePlan’s definition of either “disabled” or “permanently disabled”.Definition of DisabledYou are considered disabled under the Plan for periods when one of thefollowing applies:You receive pension creditsin the Plan if you were employedin a bargaining unitjob when you became disabledand you receive disabilitybenefits.You must ensure either youor your employer notifiesthe Plan Office if you arereceiving disability benefits.This is especially importantif you are in receipt of WorksafeBC benefits. You andyour employer are our onlysource for this information.• you are in receipt of wage-loss benefits, rehabilitation allowances orincome continuity benefits from WorkSafe BC (formerly WCB) for adisability that occurred on the job; or• you are in receipt of weekly indemnity benefits from a disability thatoccurred off the job; or• you are unable to work at a USW bargaining unit job at your lastoperation due to a non-occupational injury or illness.Definition of Permanently DisabledYou are considered permanently disabled if you suffer from a physical ormental impairment that prevents you from engaging in any employmentfor which you are reasonably suited by virtue of your education, trainingor experience and the impairment can reasonably be expected to last forthe foreseeable future. Proof that you are receiving benefits from theIWA – Forest Industry LTD Plan, or similar LTD plan sponsored by youremployer, establishes that you are permanently disabled.11

If you are a Plan Memberwho is disabled, but not eligibleto receive disabilitycredits, it is very importantto provide proof of your disabilityto the Plan Office assoon as possible after youbecome disabled. If youwait until you are ready toretire, many times you willnot be able to find proof becauserecords are no longeravailable.Proof of DisabilityTo establish your entitlement to coverage as either a Disabled orPermanently Disabled Plan Member, the Plan Office must receive proof ofyour disability status. The IWA – Forest Industry LTD Plan and many ofthe weekly indemnity plans, notify the Plan Office directly if you aredisabled and in receipt of benefits. If you are disabled but not receivingbenefits from these sources and you continue to be employed, it is youremployer’s responsibility to notify the Plan Office of your disability. Also,it is your responsibility to supply the Plan Office with medical evidence ofyour disability. You or your employer must notify the Plan Office if youare in receipt of benefits from WorkSafe BC.Eligibility for Disability CreditsAs a Disabled or Permanently Disabled Plan Member, you will accruedisability credits if:• you were employed in a bargaining unit job with a participatingemployer on the date of your disability; and• you receive wage loss benefits from WorkSafe BC, weekly indemnitybenefits or benefits from the IWA – Forest Industry LTD Plan oranother LTD plan provided by your employer.Disability CreditsIf you are permanently disabled and you are eligible to receive disabilitycredits, you will receive 125 unfunded hours for each month you aredisabled.If you are disabled, but not permanently disabled, and you are eligible toreceive disability credits, you will receive 40 unfunded hours for eachweek that you are disabled.In general, you continue to receive unfunded hours until you eitherrecover from your disability, retire, reach age 65, or die, whicheverhappens first.Covered hours include:• Contributory hoursYour credited service under the Plan is based on your covered hours. Byreceiving covered hours while disabled, you continue to earn pensionbenefits during your disability.• Unfunded hours• Excess hours12

Disabled but Not Eligible for Disability CreditsIf you have not broken service and your disability prevents you fromperforming bargaining unit work at your last operation, and you are noteligible for disability credits, then you receive no covered hours while youare disabled. However, if you supply proof of your disability to the PlanOffice and your disability prevents you from working enough hours toprevent a break in service, then the break in service will be removed andyou will remain an Active Plan Member as long as you continue to bedisabled.Additional benefit rateinformation can befound on pages 9 and 10of this booklet.As an Active Plan Member, you are eligible for the subsidized earlyretirement benefits provided by the Plan.Benefit Rate for Members Eligible for Disability CreditsThe benefit rate applied to credited service you earn when you are disabledor permanently disabled will generally be the rate you were earning on thedate of your disability. The circumstances in which the rate can beincreased are summarized below.You will receive the $35 rate if:• you qualified for the rate before you became disabled;• you were disabled before July 1, 1991 and your last employer beganto contribute $2.40 to the Plan on July 1, 1992; OR• you were permanently disabled before July 1, 1991, your lastemployer is no longer in business and contributed at the maximumrate in effect at the time of the closure.You will receive the $40 rate if:• other Plan Members working for your last employer begancontributing 10 cents an hour.You will receive the $50 rate if:• the combined effective contribution rate being paid by both the PlanMembers working for your last employer and your last employerequals $2.775 an hour.You will receive the $60 rate• the date the maximum required contribution rate is being paid byboth the Plan Members working for your last employer and your lastemployer.13

Shortened Life ExpectancyIf, prior to starting your pension, you suffer from an illness or injurywhich significantly reduces your life expectancy, you may apply toreceive a portion of your benefit which would normally be paid afteryour death. To be eligible for this payment, you must produce acertificate from a doctor(s) stating that you are suffering from acondition that will likely result in your death within one year. If youreceive this payment, the amount of the benefit paid on your death willbe reduced by the amount plus interest, that has been advanced to youunder this provision.For further information please contact the Plan Office.14

DEATH BEFORE RETIREMENTIf you die before you are vested in the Plan, a death benefit equal to thecontributions you made to the Plan, plus accumulated interest will bepaid.If you die after you are vested, the Plan will pay a death benefit equal to60% of the commuted value of your pension as described below.Amount of Death BenefitThe death benefit is equal to 60% of the commuted value of yourpension and is payable whether you are an Active Plan Member or anInactive Plan Member on your date of death.If you are an Active Plan Member under age 55 at the time of yourdeath, the commuted value is determined assuming that you had abreak in service on your date of death.Definition of Spouse forthe Pension Plan is:• the person you are legallymarried to and, forthe two-year period immediatelybefore the relevanttime (e.g., retirementor death), were not livingseparate from; or, if thisdoes not apply,• the person, of the sameor opposite sex, who haslived with you in a marriage-likerelationship forthe two-year period immediatelybefore the relevanttime.If you are an Active Plan Member and you are at least 55 years old atthe time of your death, the commuted value is determined assumingthat you had retired on your date of death. This means the commutedvalue includes the value of the Plan’s subsidized early retirementfactors.Details on how a commuted value is determined are shown in theCommuted Value and Transfer Options section (see page 24).ExampleA Plan Member dies on March 1, 2008, at age 45, with 20 years ofcredited service under the Plan. The member has an earned pension of$735 a month (13 years at $35 and 7 years at $40), payable at age 65.Assuming an interest rate of 4.25% per year, the commuted value of hispension would be $40,858.00. The death benefit is equal to 60% of thecommuted value, or $24,514.80.Recipient of Death BenefitIf you die before retirement, your beneficiary – the person who willreceive the death benefit – is automatically your spouse. Your spousecan waive this right by signing a spousal waiver. If your spouse signs awaiver, you can nominate an alternate eligible beneficiary. If you do nothave a spouse, your beneficiary will automatically be your estate unlessyou choose to name someone else.15

If you wish to name a minor child as your beneficiary, you shouldappoint an adult to receive the benefit as trustee for the child. For moreinformation about naming a beneficiary, please contact the Plan Office.If there is a court order or agreement dividing your pension with aformer spouse, the death benefit will be split in accordance with thedirection of the agreement.How the Benefit is PaidIf your spouse is entitled to a death benefit, he or she has a choice toreceive a monthly pension from the Plan or a lump sum payment.Details on the lump sum options are provided in the Commuted Valueand Transfer Options Section (see page 24).If a named beneficiary or your estate is entitled to receive the deathbenefit from the Plan, it will be paid as a lump sum.16

LEAVING YOUR JOBBreak in ServiceYou break your service when you fail to work - or otherwise accumulate- 350 qualifying hours in two consecutive calendar years. The hoursthat qualify are contributory hours (see page 6), all hours for which youreceive disability credits (see page 12) and layoff hours (but only to amaximum of 200 layoff hours in any two consecutive years). Excesshours and vacation hours do not count toward preventing a break inservice.Excess hours DO NOT preventa break in service.The consecutive calendar year stipulation usually means you breakservice only on December 31 st . The exceptions to this rule are:• if you permanently transfer to a management position;• if you are an employee of an employer which negotiates towithdraw from the Plan;• if your bargaining unit elects to decertify from the USW;• if your employer becomes a suspended employer for non-paymentof contributions ;• if you are an Owner-Operator who opts out of the Plan (see page20).VestingTo be vested is to have a right to a pension from the Plan. If you breakservice after becoming vested, you are eligible for a pension when youreach retirement age, and your spouse (or other beneficiary) is entitledto a death benefit if you die before retiring.You are vested in the Plan if, after becoming a Member of the Plan:You are vested in thePlan if:• you have two years ofcontinuous service afterbecoming a Member ofthe Plan;OR• you are an Active PlanMember aged 55 or more,regardless of your lengthof service.• you have two years of continuous service with some or all of yourservice after December 1, 1997; or• you are an Active Plan Member age 55 or more, regardless of yourlength of service.BenefitsIf you are not vested when you break your service, you willreceive a cash refund of your employee contributions with interest. Youwill be entitled to no further benefits under the Plan in respect of yourservice prior to the break.17

If you are vested and under age 55 when you break service, youbecome an Inactive Plan Member. As an Inactive Plan Member, you areentitled to receive the pension you have earned under the Plan, commencingat age 65.If you are vested and age 55 or older when you break service, youare eligible to retire under the Plan and will receive the benefits described inthe Retirement Section (see page 25).Break in Service for Vested Plan Members Prior to Age 55If you are vested and under age 55 when you break service, you have thefollowing options:If you leave your pensionin the Plan, you maybenefit from futurenegotiated improvements,benefit upgrades andimmediate vesting if youreturn to USWemployment.If you choose to transferthe commuted value ofyour earned pension, youare no longer a PlanMember.1. Leave your pension in the Plan and receive a monthly pensionwhen you retire.If you choose to leave your pension in the Plan, you will receive amonthly pension from the Plan commencing at age 65 equal to yourearned pension and based on your credited service with the benefit rateapplicable on the date you break service.Details on your pension options are found in the Retirement Section(see page 25).2. Receive a lump sum transfer of the commuted value of yourpension.You may elect to transfer the commuted value of your earned pensionto a prescribed plan such as an RRSP. Details on how your commutedvalue is calculated are provided in the section for Commuted Value andTransfer Options (see page 24).Once you transfer the commuted value, you are responsible forinvesting the funds to provide for your retirement. You will not beeligible to receive any future pension benefit improvements or postretirementbenefit increases, nor will your spouse or beneficiary beeligible to receive a benefit after your death.18

Transfer DeficiencyIf you elect to transfer the commuted value of your pension, pensionlegislation may require the Plan Office to transfer it in two instalments.The first instalment would be paid after you break your service andprovide all of the necessary documents to the Plan Office. The secondinstalment plus interest, would be transferred five years later.Returning to WorkIf you are vested, break your service and leave your pension in the Plan,then return to work for a participating employer, your two periods ofcredited service are considered separate. You are an Inactive PlanMember for the period before you broke service and an Active PlanMember for the new service period. On your return as an Active PlanMember, you are immediately vested for all of the benefits you earn inyour new service period.If your break in service was due to an involuntary job loss, you may beeligible to upgrade the service you earned before your break. This Planprovision is called “Two for One” and is described on page 22.If you transferred the commuted value of your pension after your breakin service and then returned to work with a participating employer, youwill be treated as a newly entering Plan Member and must again satisfythe vesting requirements under the Plan.Transfer to a Salaried JobIf you permanently transfer from a bargaining unit position to a salariedjob with a participating employer, you are considered a managementtransfer on the date you transfer and you break your service on thatday. You will thereafter be treated as an Inactive Plan Member and yourpension from the Plan will be calculated using the benefit rate(s) thatapplied when you transferred. You also lose any excess hours you haveaccumulated.If you are not vested when you become a management transfer, youwill retain your Plan membership for as long as it takes for you tobecome vested provided you remain employed by a participatingemployer. This way you do not lose credits already earned in the Plan.If you are vested when you become a management transfer, you mayelect to leave your deferred pension in the Plan or transfer thecommuted value of your earned pension out of the Plan (see page 24).19

If you move to a salaried job, then return to a bargaining unit position,your break in service will be removed if all of the following conditionsare met:• you begin working in a salaried position within 3 months of leavingyour bargaining unit position; and• you return to a bargaining unit position within 3 months after leavingyour salaried position; and• you have at least 1,000 covered hours in each of 3 consecutive Planyears or you remain in a covered bargaining unit position for 5 yearsfollowing your return.If your break in service is removed, your excess hours will be reinstated.If the transfer is temporary, that is not longer than three months, youmay return to your bargaining unit job and retain your Active status inthe Plan.Owner/OperatorTo be eligible to participate in the Plan as an Owner/Operator you mustsatisfy all of the following conditions:• incorporate a company to carry on your business;• enter into a collective agreement with the Union and a participationagreement with the Plan;• own at least 10% of the shares of your company;• work in a job with your company that is considered part of thebargaining unit for at least 75% of the time.When your company joins the Plan, as an Owner/Operator you will havethe choice to participate. If you are an Active Plan Member who leavesemployment with a participating employer and then become an Owner/Operator before you have a break in service, it is very important todiscuss your circumstances with the Plan Office. There are provisions inthe Plan which may significantly affect your accrued benefit if youchoose not to participate as an Owner/Operator.20

Leave of AbsenceIf you take a leave of absence, for other than medical reasons, you willnot receive pension credits for the time you were absent from work.If you take a long leave of absence, you could break service and becomean Inactive Plan Member. A break in service occurs when you have lessthan 350 qualifying hours in the last 2 consecutive calendar years.You will not break service if you take a leave of absence because youare elected or appointed to:• public office;• the Canadian Labour Congress;• a Provincial Federation of Labour; or• a District Labour Council.You will not receive pension credits for the time you are on leave, butyour standing in the Plan, during the time you hold office, will be thesame as if your service had been continuous.You will not break service if you accept a full-time provincial or federalgovernment appointment as a representative of USW or the labourmovement, as long as your absence is approved by the Trustees. Youmust inform the Plan Office if you are going to take a leave of absencewhich may result in a break in service.Involuntary Job LossDefinitionAn involuntary job loss occurs if you lose your job due to technologicalchange, your job is eliminated or there is a permanent closure of youremployer’s operation.Upgrade to Active StatusIf you have a break in service because you had an involuntary job loss,you will become an Inactive Plan Member and will be eligible to receivea deferred, unreduced pension at age 65. You may also elect to retireany time after you turn 55 years old.Normally Inactive Plan Members who choose to retire before they turn65 will have their pension benefit determined on an actuarial equivalentbasis (see page 27). If you have an involuntary job loss, you may beeligible to receive the more favourable subsidized early retirementbenefits that apply to Active Plan Members.21

If you have an involuntaryjob loss, but you thinkyou will probably workagain for a participatingemployer, in most casesit is in your financial bestinterest to leave yourpension benefit in thePlan. Please contact thePlan Office for moreinformation.To be eligible you must satisfy all the following conditions:• have an involuntary job loss on or after July 1, 1992; and• be at least age 50, but not yet age 55, on the date of your job loss; and• be working for an employer that contributed a minimum of $2.40 anhour to the Plan; and• break service prior to age 55; and• work less than 1,001 hours for a participating employer(s) between thedate you lose your job and the date you break service; and• elect to leave your pension in the Plan after the break in service.If you meet the eligibility requirements for this Plan provision, your pensionwill be determined using the same basis which is applied to Active PlanMembers (see page 26).Plan Members who have an Involuntary Job LossEffective July 1, 1986, a Plan Member who:• has an involuntary job loss; and• is an eligible employee of a participating employer or is totally andpermanently disabled at the time of such involuntary job loss; and• has attained age 55 but has not yet attained age 60 at the time of suchinvoluntary job loss;will not have a break in service as a result of such event, but will have abreak in continuous future service employment on the earlier of the date hedies or the date he retires under Article 9.For Plan Members Age 55 or older:If your involuntary job loss occurs after you have attained age 55 and priorto the date you attain age 60, you will not have a break in service. Thismeans, if you have excess hours, you can continue to use those hours toaccrue additional years of service until the earlier of the date all excesshours have been used; the date you chose to retire or your 60th birthday.The Two-for-One RuleTwo-for-One RuleYou are eligible to upgradetwo years of InactiveService for every one yearof Active Service in whichyou worked 1,500 coveredhours.If you have an involuntary job loss, sustain a break in service and return towork for a participating employer, it may be possible to upgrade some of thecredits you earned before you broke service. The two-for-one rule allowsyou to move service you earned prior to your break into Active service. Theservice that is moved from Inactive to Active also qualifies for thesubsidized early retirement benefits. As well, the upgraded service yearsbecome eligible for any benefit rate and Plan improvements.22

As long as you return to work for a participating employer whocontributes a minimum of $2.40 an hour to the Plan, for each year youearn a full year of credited service you can upgrade two years of serviceprior to your break. To be eligible for the two-for-one rule you mustsatisfy all the following conditions:• break service on or after December 31, 1983; and• break service due to an involuntary job loss; and• work less than 1,001 hours for participating employers between thedate of your job loss and the date you had a break in service; and• become an Active Plan Member within 3 years following your break inservice date; and• work for an employer who contributes a minimum of $2.40 an hourto the Plan; and• leave your pension in the Plan after the break in service.Example• You lost your job in 1988due to a permanent closure.• You broke service onDecember 31, 1990 with20 years of service.• The benefit rate at thetime you broke servicewas $32.• You rejoined the Plan onJanuary 1, 1993.• You have continued towork for an employerwho contributes a minimumof $2.40 per hour tothe Plan.• You have worked 1,500covered hours in eachyear for 7 calendar yearssince your return.In the example, 7 years ofservice after your break upgrades14 years before yourbreak. The 14 years arenow:• credited at the $35 benefitlevel• treated as active service• eligible for the subsidizedearly retirement benefits.23

COMMUTED VALUE AND TRANSFER OPTIONSThe commuted valuenever includes theamount of money youwill require to replacethe subsidized earlyretirement benefitsprovided by the Plan.Commuted ValueIf you decide to transferthe commuted value ofyour accrued pensionbenefit to a RRSP orother pension plan, theamount of that transferis the current value ofyour pension benefit.You cannot reverse acommuted valuetransfer.The commuted value is the amount of money that, if invested today and leftuntil you are 65, would be expected to be sufficient to provide the samemonthly pension as you would have received from the Plan at 65.The amount of the commuted value is based on three things:• The amount of your earned pension. The greater your earned pension,the larger the commuted value.• Your age. The closer you are to retirement age, the less time yourinvestment income has to grow on the amount transferred, so the amounttransferred is greater.• Interest rate. The interest rate used is determined based on the yield oflong-term Government of Canada bonds. As interest rates increase, theamount of your commuted value would be lower since you will have higherinterest earnings on the transferred amount. If interest rates decrease, theamount of your commuted value increases since your investment would beexpected to earn less.Transfer OptionsIf you break service and you have not attained age 55, you are entitled toreceive a lump sum transfer of the commuted value of the pension you haveearned. This option is available provided that you submit all the requireddocumentation by the 180 day deadline from your break in service date.If you die, your spouse or beneficiary is entitled to receive a lump sum transferof the death benefits payable under the Plan.In general, a lump sum payment from the Plan to a Plan Member (following abreak in service) or to a spouse (following the death of a Plan Member) must bemade as a transfer to an “Approved Investment Vehicle.”Examples of Approved Investment Vehicles are:• a locked-in RRSP;• a Life Income Fund (“LIF”);• another registered pension plan (if the plan allows it); and• an annuity from an insurance company.Commuted value amounts transferred to one of these “investment vehicles”cannot be withdrawn as cash, but must be used to provide you with retirementincome.If the commuted value is less than a minimum amount, you may elect toreceive your commuted value as either a cash lump sum or as a transfer to anon-locked-in RRSP.24

RETIREMENTApplying for a PensionYou may retire under the Plan at any time after you reach age 55. Yourpension does not begin automatically, you must apply for it. Applicationforms are available from the Plan Office. Usually your local union andyour employer also keep a supply on hand.You should apply 3 months before your planned retirement date. It is inyour best interest to apply early since your retirement date is always thefirst day of the month and cannot be before the date you sign and fileyour retirement applications.In addition to the application form, you will need to include copies ofyour birth certificate or other proof of age, and if you have a spouse,your spouse’s birth certificate. If you or your spouse no longer use thenames on your birth certificates, you need to include a copy of a proofof name change or a marriage certificate.Acceptable proof-of-age documents include:• Canadian birth certificate• Passport or landed immigrant certificates• Quebec baptismal certificates• Canadian citizenship certificatesRetiring as an Active Plan MemberIf you are an Active Plan Member, you are only eligible to retire if youare no longer employed as a bargaining unit employee of a participatingemployer. If you retire on or after age 60, you will receive your fullearned pension. If you retire prior to age 60, you will receive between82% and 99% of your earned pension.You “earn” eligibility to receivesubsidized early retirementbenefits if you are anActive Plan Member whenyou retire.What if I disagree with theway my benefit has beencalculated?You can appeal any decisionthat directly relates to youand pertains to the applicationof Plan rules.Direct your appeal, inwriting, to:Board of TrusteesIWA–Forest IndustryPension PlanSuite 150 - 2955 Virtual Way,Vancouver, BC V5M 4X625

Early Retirement Reductions for Active Plan Members:Age Pension BeginsPercentage of Pension Payable55 82%56 86%57 90%58 94%59 97%60 100%The percentages are pro-rated if you retire at other than the exact agenoted in the table. Example: If you retire at age 55 years and 6months, you will receive 84% of your pension.Latest Retirement DateYou must retire and start receiving your pension no later than December1 st of the year you reach age 71. Even though you must retire by thatdate, you can continue to work but will not be eligible to earn furtherbenefits under the Plan.Retiring as an Inactive Plan MemberIf you had a break in service prior to age 55, or if you had reached age55, and, after December 31, 2000 any of the following occurred:• your employer negotiates to withdraw from the Plan; or• your bargaining unit elects to decertify from USW; or• your employer becomes a suspended employer for non‐payment ofcontributions; or• you are an Owner-Operator who opts out of the Plan,you become an Inactive Plan Member. As an Inactive Plan Member youare entitled to a pension beginning at age 65. You may choose to startreceiving your pension at any time after you reach age 55 and beforeDecember 1 st of the year you reach age 71.If you elect to begin receiving your pension before you reach age 65, thebenefit you are eligible to receive at age 65 will be reduced and you willreceive the “actuarial equivalent” of the benefit you would receive at age65.26

The actuarial adjustments are determined periodically by the Trusteesbased on expected long-term economic assumptions. The adjustment ismade because by retiring earlier, you are expected to be receivingpayment of your pension over a longer period of time. Currently, theactuarial adjustments are as follows:Pension Adjustments for Inactive Members:Age Pension Begins Percentage of Pension Payable55 42.4%56 46.0%57 49.9%58 54.2%59 59.0%60 64.2%61 70.0%62 76.3%63 83.4%64 91.3%65 100%If you are an Inactive Plan Member who had an involuntary job lossafter you had reached your 50 th birthday, you may be eligible to receivea special status in the Plan (see page 21).Options for the Payment of your PensionAs a retired Member of the Plan, you will receive a pension for life. Ifyou have a spouse, government regulations require you to select the60% Joint and Survivor Option as a minimum coverage for your spouse,unless your spouse signs a form waiving his or her right to this benefit.Waiver forms are available from the Plan Office.If you do not have a spouse, or if your spouse signs the waiver form,you may provide a benefit for another beneficiary by choosing one ofthe guaranteed options described below. The Pension Plan requires youto sign a declaration confirming that you have no spouse.Straight LifeA pension payable for aslong as you live. It givesyou the highest possiblemonthly pension payments,but your beneficiary will receivenothing. Paymentsstop at the end of the monthin which you die.Joint and Survivor PensionUnder a Joint and Survivor pension form, you receive your pension onthe first day of every month starting on your retirement date and endingon the first day of the month in which you die. Following your death, ifyour spouse is still alive, he or she will receive a monthly pension fromthe Plan for the rest of his or her life.27

The amount of pension your surviving spouse receives will be apercentage of the benefit you received in your lifetime, depending onthe option you choose.You can choose one of the following options:• Joint and 60% Survivor Pension• Joint and 66 % Survivor Pension• Joint and 75% Survivor Pension• Joint and 100% Survivor Pension• Joint and 60% Survivor Pension with 120 month GuaranteeExample:If you choose a Life Pensionwith 120 month Guaranteeand you die after you havebeen retired for six years,your named beneficiary iseligible to receive the balanceof 120 months.Since you received:• 72 monthly payments(6 yrs x 12 mths = 72mths).your beneficiary would receivebenefits for a further48 months:• 120 mths-72 mths = 48mthsIf you choose a Life Pensionwith no Guarantee, no benefitsare payable after yourdeath.Life Pension with and without Guarantee PeriodUnder a Life with Guarantee Period pension form, you also receive yourpension on the first day of every month starting on your retirement dateand ending on the first day of the month in which you die. If you diebefore receiving the number of guaranteed monthly payments, yourpension will continue to your beneficiary until the total number ofmonthly payments made to you and your beneficiary combined, equalthe guarantee period.You can choose one of the following options:• Life Pension with 60 month Guarantee• Life Pension with 120 month Guarantee• Life Pension with 180 month Guarantee• Life Pension with no Guarantee (Straight Life)Supplemented Early Retirement OptionUnder a Supplemented Early Retirement option, you receive a greaterpension from the Plan prior to age 65 and a smaller pension after age65. The difference between the amounts paid before and after age 65 isintended to equal the amount of pension you are expected to receivefrom Old Age Security.The Supplemented Early Retirement option is available with all of theforms of pension benefits shown above.28

FURTHER INFORMATIONDivorced or Separated MembersYour pension benefit is considered a “family asset” under the B.C.Family Relations Act or equivalent legislation in another province. Whenthe Plan Office staff receive notification of an agreement or orderdividing the benefit, they are required by law to comply. The Plan Officewill pay the former spouse’s portion directly to her or him, with incometax deducted. There is a one-time charge to administer the division ofpension benefits and establish a Limited Member account. The $500 feemust be divided and paid equally by you and your former spouse. Acopy of the court order or agreement must be filed with the Plan Office.If you are required to name your former spouse as a beneficiary fordeath benefits, contact the Plan Office for a “division of pensionbeneficiary form” which allows you to name your former spouse asbeneficiary for a portion of your pension and another person asbeneficiary for the remainder.If you Return to Work After RetiringYou cannot receive a pension and earn pension credits at the same time.If you retire and begin to receive your pension, then return to work:• Your pension will stop if you work regularly for a participatingemployer.• When you stop working for a participating employer, any pensioncredits you have earned since you started working again will beadded to your retirement benefit.• Your pension will continue if you work less than 20 hours a week fora participating employer.• Your pension will continue regardless of your employment status ifyou work after December 1 st of the year in which you turn age 71.The Plan Office will assumeyour former spouse has alegal interest in a portion ofyour pension benefit until acopy of the order or agreementstating otherwise isfiled.I just got divorced. Willthis affect my pension?In most cases, your formerspouse is entitled to a shareof the pension you earnedwhile you were married. Theamount your former spouseis entitled to is usuallyspecified in a court order orseparation agreement.Also, you will likely want todesignate a new beneficiaryfor any death benefits payableunder the Plan.29

Sources of Retirement IncomeYour IWA-Forest Industry Pension is only one source of retirementincome. Other sources include Canada Pension Plan, Old Age Securityand income from personal investments like RRSPs.Canada Pension Plan (CPP) provides a lifetime monthly retirementpension. The amount you receive depends on the number ofyears you contributed to the Canada Pension Plan, your annualearnings and your age at retirement. You may apply for a CPPpension any time after your 60 th birthday, but the benefit isreduced by one-half per cent for each month you are under age65 (up to 6 per cent per year). In 2008, the maximum pensionis $884.58 a month ($10,614 per year). CPP benefits areadjusted annually to reflect a cost-of-living increase.Old Age Security (OAS) provides a lifetime monthly pension startingat age 65. You must apply for this pension. To be eligible forthe maximum benefit, you must meet Canadian residency andincome requirements, otherwise the benefit is reduced.Depending on your total income, you may have to pay tax on thisbenefit. The maximum benefit as of January 1, 2008 is $502.31a month ($6,027 a year). OAS payments are adjusted everythree months to reflect the cost-of-living.Spouse’s income. Your spouse may also be eligible to benefits fromOld Age Security, Canada Pension Plan and an employmentpension plan.Personal investments Personal investments like RRSPs, CanadaSavings Bonds, or term deposits may add to your retirementincome.30

For more informationPension estimates When you apply for your pension, you will get anestimate of the amount you would receive under the differentoptions. If you would like an estimate before that time, call thePlan Office.Counselling If you are planning retirement and need help, contact thePlan Office, your employer or your union local for assistance.Government publications Human Resources Development Canada hasseveral publications about government pensions availablethrough the federal government office. If you have Internetaccess go to http://www.hrsdc.gc.ca/en/isp/cpp/cpptoc.shtmlCanada Revenue Agency has tax guides for seniors availablethrough federal government offices or on the Internet at http://www.cra-arc.gc.ca.31

This booklet reflects the terms of the IWA – Forest Industry Pension Planlaid out in the contract between USW and most Forest IndustryEmployers in B.C. and the changes effective January 1, 2008. Itreplaces all previous booklets.Pension rates and rules have changed many times since the Plan beganin 1973. Most of the changes were not retroactive, so if you retired orbroke service before January 1, 2008, some of the information in thisbook will not apply to you. If you are in doubt about your status, thePlan Office will be pleased to advise you.The Plan’s Trustees may occasionally make adjustments to the Plan.DisclosureIn accordance with Section 10 (4) and (5) of the Pension BenefitsStandards Act of British Columbia, any person entitled to a benefit fromthe Plan, or the spouse or designated beneficiary or agent of the personentitled to a benefit, has a right to examine the Plan documents uponproviding the Plan Office with a written request. Such right shall notapply more than once in any twelve-month period.32