Nortel Networks Corporation, December 5, 2017
December 5, 2017
Morneau Shepell has implemented increases for pensioners-in-pay who chose the annuity option under both the Negotiated and Managerial Pension Plans pursuant to addenda filed with Financial Service Commission of Ontario (“FSCO”) subject to certain exceptions described below. The increases were made with the November 25th deposit for both the Plans and a retroactive payment has been made as a separate direct deposit.
Those who elected a lump sum transfer of their commuted value will be provided with lump sum amounts in the first or second quarter of 2018.
Please note that the increases do not include:
- Ontario pensioners covered by the Pension Benefits Guarantee Fund (PBGF) with benefits of $1,000 or less;
- Quebec pensioners who elected the RQ option in the Negotiated Plan, which the RQ will make at a later date in 2018; and
- Estates where as a result of the death of a pensioner (or survivor) monthly payments are no longer being made, however, a retroactive payment is owed, which will be made some time in 2018.
In addition, amounts relating to Ontario service do not include the CCAA recovery for indexation. The court appointed Representatives filed an objection with the Superintendent of Financial Services with respect to the proposed distribution of amounts recovered for indexation in an addendum to the wind up report filed by the administrator of the Nortel pension plans, Morneau Shepell.
The Representatives object to the amounts recovered for indexation on behalf of Ontario members entitled to indexation from being incorporated in the calculation on the funded ratio and ultimately being used to reduce the PBGFs obligation towards the pension plans, rather than going directly to each member’s individual claim for lost indexation. In aggregate, the advisors for the Representatives believe the amount in dispute could be worth up to $100 million that would go to eligible Ontario members instead of the PBGF.
Submissions are being exchanged by the parties at this time and the possible next step may include an appearance before the Financial Services Tribunal of Ontario.
If you have any questions regarding the increases to pension benefits, retroactive payments or QRLSP forms that were included with Morneau’s Notice of the increase, please contact Morneau Shepell directly at:
- Negotiated Pension Plan: 1-877-392-2073
- Managerial and Non-Negotiated Pension Plan: 1-877-392-2074