Temporary Part-time Work Arrangements
For members who enter a temporary part-time work arrangement on or after February 1, 2022, members and employers are required to continue contributions based on a member’s regular work hours unless the member elects in writing to make contributions on their reduced hours only.
The member’s choice to make contributions during the arrangement based on their regular hours or on their reduced hours should be indicated on the Temporary Part-time Work Arrangement Contribution/Buyback Application (OPTrust 1030). This form must be completed by the member and employer and the employer must submit it to OPTrust before the start of the arrangement, whether or not the member elects to contribute based on their regular hours or on their reduced hours only.
The OPTrust 1030 form can also be used for members to apply to buy back pension service after a temporary part-time work arrangement ends.
What is a Temporary Part-time Work Arrangement?
A temporary part-time work arrangement is a period of reduced work hours that meets all of the following criteria:
- The member temporarily switches from full-time hours to part-time hours or from regular hours to reduced hours.
- The part-time work arrangement is temporary, not permanent, and has a start date and anticipated end date.
- The employer and member have agreed to the terms of the temporary part-time work arrangement in advance, including its duration.
- The conditions in the federal Income Tax Act are met, including:
- The 36-month minimum employment rule - members may only accrue full-time pension service for a period of reduced work hours if they have been employed with their employer for at least 36 months before the start of the arrangement. Please note that due to the COVID-19 pandemic, the federal government waived this requirement for arrangements that began in 2020 or 2021.
- The five-year cumulative limit - the amount of pension service members can accrue during an unpaid leave and/or a period of reduced work hours with their employer is limited to a maximum of five years with an additional three years for pregnancy/parental leaves.
Job-sharing may be one example of a temporary part-time work arrangement. Temporary layoffs, workplace suspensions, periods of disability and permanent changes in work hours do not qualify as temporary part-time work arrangements.Since a temporary part-time work arrangement is subject to an agreement between a member and employer, employers are responsible for reporting each arrangement that meets all of the above criteria to OPTrust. All employees with the same type of arrangements should be treated consistently for pension purposes.
Contributions During a Temporary Part-time Work Arrangement that Occurs on or After February 1, 2022
If the member decides to continue making contributions based on their regular hours during the arrangement, employers are required to match contributions, and the costs for both the member and the employer equal the contribution amounts that would have been paid had the arrangement not taken place. During the arrangement full contributions should be deducted from the member’s reduced salary.
Members may also elect to contribute only on the reduced hours they work during the arrangement and apply to buy back the pension service for the hours they didn’t work after the arrangement ends. Members contributing on their reduced hours only will not earn pension service for the hours they do not work during the arrangement.
Note! Members who started a temporary part-time work arrangement before February 1, 2022 may only apply to buy back pension service for the hours they didn’t work after the arrangement ends and they have returned to their regular working hours.
Important! Members and employers are required to make pension contributions based on the member’s regular hours unless the member elects in writing to make contributions on their reduced hours by using theTemporary Part-time Work Arrangement Contribution/Buyback Application (OPTrust 1030) form. If OPTrust does not receive this form in a timely manner before a temporary part-time work arrangement starts, member and employer contributions will be mandatory and will be treated as missed mandatory contributions if they are remitted to OPTrust late.
Any changes to a temporary part-time work arrangement should be reported to OPTrust.