Sears Canada Inc., February 27, 2018
February 27, 2018
On Thursday, February 22, 2018, the CCAA Court approved the Employee and Retiree Claims Process through which the claims of all employees and retirees of Sears Canada will be valued. For the last three months, Pension Representative Counsel and the Pension Representatives have worked closely with the Monitor and negotiated extensively with the Sears Canada Entities to develop the Employee and Retiree Claims Process.
In accordance with the Employee and Retiree Claims Process, the Monitor will be mailing a Retiree Claims Package to all retirees with pension and/or retiree benefit entitlements by March 5, 2018.
There are a number of claims that will be quantified and filed in connection with the Retiree and Pensioner Claims Process, including:
- Sears Pension Claim – Pension Representative Counsel will be advancing and filing a first priority claim for the amounts owing by the employer to the defined benefit component of the Sears Canada Plan based on statutory deemed trust priority provisions in the Ontario Pension Benefits Act and the Ontario Personal Property Security Act. You do not need to take any action to advance any claim you may have in respect of any defined benefit entitlements under the Sears Canada Plan.
- Retiree Benefit Claim (Health, Dental, and Life Insurance) – As you are aware, on October 1, 2017, the Sears Canada Entities terminated the payment of health, dental and life insurance benefits (including MSP premiums for B.C. residents) to eligible retirees or their surviving spouses. The termination of those amounts generate claims that reflect the loss of the future payment of these benefits to each eligible individual. We, in consultation with the Pension Representatives and our actuary (Segal Company) have had discussions with Sears Canada and the Monitor with respect to the calculation of these claims. The formula for calculating these claims has been approved by the CCAA Court. All eligible retirees will receive a Retiree Benefit Claims Statement, which will include the full amount of their individual Retiree Benefit Claim along with their personal information that was used to calculate the claim. You will be provided with an opportunity to review your Retiree Benefits Statement and to make any corrections to the personal information data that was used to value your claim. If your personal information data is correct, you do not need to take any further action. Please note that the deadline to make any corrections to your personal data and complete the Retiree Request for Correction Form is 5:00pm Eastern Standard Time on May 7, 2018.
- Retiree Discount Claim – Individuals who were previously eligible for a lifetime discount will have a claim in the amount of $840 submitted by the Sears Canada Entities on your behalf. You do not need to take any action to file your retiree discount claim.
- Supplemental Pension Plan Claim – We, in consultation with the Pension Representatives and our actuary (Segal Company) will be calculating and filing a claim on behalf of all retirees with entitlements under the Sears Canada Inc. Supplemental Retirement Plan. We will be providing more information under separate cover to all eligible retirees regarding the amount of their supplemental pension claim in the coming weeks.
If you feel that you have a claim that is not covered in the Retiree Letter and/or Retiree Package that you will receive, you will also be provided with an opportunity to file a proof of claim. The deadline to file a proof of claim is 5:00pm Eastern Standard Time on April 9, 2018.
Documents relating to the Employee and Retiree Claims Process can be accessed here:
- Employee and Retiree Claims Procedure Order
- Notice to Claimants
- Retiree Claims Package
- Letter from Koskie Minsky
It is important to bear in mind that the claims process will generate a claim on your behalf, but the distribution of the estate of the Sears Canada Entities is many months away. The determination of claims in this process will not result in the payment to retirees of 100% of the value of proven claims.
Please check the KM website frequently in order to keep informed about progress and important dates.