In an attempt to avoid direct compliance with Supreme Court of Canada rulings requiring equal treatment of same-sex partners, Alberta has created adult interdependent relationships as a new class of relationship with rights and obligations currently not available in any other Canadian jurisdiction.
Alberta Bill 30-2, the Adult Interdependent Relationships Act, received royal assent in December. It amends more than 60 statutes to recognize adult interdependent partners (AIPs) and provide some property rights to individuals in such relationships. The majority of the changes in the bill will come into effect on proclamation, which is expected in the first quarter of 2003. One notable exception is the Alberta Personal Income Tax Act amendments, which are retroactive to Jan. 1, 2001.
Alberta Finance was able to convince the government not to give AIPs the same rights as spouses under the Employment Pension Plans Act (EPPA) because pension plans recognizing platonic relationships cannot be registered under the federal Income Tax Act (ITA). Instead Alberta introduced the term “pension partner,” which includes common-law heterosexual and same-sex partners. Similar amendments have been made to legislation governing public-sector plans for management employees, local authorities, special forces, the public service, members of the legislative assembly or provincial judges and masters in chambers.
Changes to the Alberta Personal Income Tax Act are also not extensive since they would be inconsistent with the ITA. Furthermore the changes will not have any direct impact on group and health-care plans, since any regulatory provisions are tax driven.
Definitions
Bill 30-2 defines an AIP as a person who has lived with the other person in a relationship of interdependence for a continuous period of not less than three years or in a relationship of some permanence if there is a child of the relationship by birth or adoption. An adult interdependent partnership can also be created by agreement between two people and an agreement is required where the parties are related by blood or adoption. A married person cannot become an AIP while living with his spouse and a person can only have one AIP at a time.
Family law, wills and estates
The greatest impact of the act will be with respect to family law support provisions and wills and estates:
•The Domestic Relations Act will include a new section dealing with support orders and support agreements for AIPs. This is clearly a response to the May 20, 1999 Supreme Court of Canada decision in M. v. H. [1999] 2 S.C.R. 3 (S.C.C.). In that case, an Ontario woman challenged the definition of “spouse” under Ontario’s Family Law Act in seeking support after she split up with her partner following a five-year relationship.
•The Health Insurance Premiums Act will extend premium assistance to AIPs receiving benefits under the Seniors Benefits Act.
•Under the Intestate Succession Act surviving AIPs will have similar rights to spouses when a person dies without a will.
•The right to a property split in the absence of an agreement between the parties is not available to common law spouses and has not been extended to AIPs under the Matrimonial Property Act.
Pensions
In December, Alberta released EPPA Update 02-03 which explains the changes to the Employment Pensions Plan Act and how pension plan administrators should respond.
The most significant change contained in Bill 30-2 is the change from “spouse” to “pension partner.” This new definition, like the old one, includes a person who, at the time a right to a benefit is determined, was married to that other person and had not been separated from that person for three or more consecutive years. The significant change comes in the cases where there is no married spouse, but there is another person who is in a conjugal relationship with the member.
Under the new definition a person who, immediately preceding the time the benefit is determined, had lived with that other person in a conjugal relationship for at least three years, or in a relationship of some permanence if there is a child of the relationship by birth or adoption, is a pension partner and therefore eligible for the same spousal benefits as if they were married to the member. This definition restricts spousal benefits to those in conjugal relationships to be consistent with the ITA.
Administrators will not be required to file the amendment with the superintendent of pensions immediately after proclamation, although they may do so if they wish. They are required to file the amendment on the next occasion on which they submit other amendments or by Dec. 31, 2003, whichever is later.
It should also be noted that a plan must be administered in accordance with the legislation once it is proclaimed, regardless of whether the plan text has been amended.
Beyond conjugality
It seems somewhat ironic that, because of the ITA, government intentions were thwarted with respect to pensions and benefits which have been a key battleground in the campaign to extend rights to same-sex partners. But it is important to recognize Alberta is not the only jurisdiction that has considered enlarging the class of dependents with entitlement to various rights and benefits.
When the Law Commission of Canada’s report, Beyond Conjugality, was released in January 2002, Justice Minister Martin Cauchon said he would consider a proposal to extend federal benefits to cohabitants who are in economically dependent relationships, including adult siblings, aging parents, grown children, disabled adults and their caregivers or even old friends.
If the recommendations set out in the report are followed, the federal government would oversee a registry that would give two people in an economically interdependent relationship the option of recording their arrangement in order to become eligible for income tax breaks, pension and survivor benefits and other employment-related perks currently available to married, common-law and same-sex couples.
There have been no recent indications the federal government plans to act on these recommendations, but benefits plan sponsors and their advisors should be vigilant. If mandatory benefits coverage was expanded to include a broader class of economically interdependent relationships, plan sponsors and their advisors would have to develop innovative plan designs to control both liability and expenses.
Sheryl Smolkin is a lawyer and director of Watson Wyatt Worldwide’s Canadian Research and Information Centre in Toronto. She can be contacted at [email protected].
Alberta Bill 30-2, the Adult Interdependent Relationships Act, received royal assent in December. It amends more than 60 statutes to recognize adult interdependent partners (AIPs) and provide some property rights to individuals in such relationships. The majority of the changes in the bill will come into effect on proclamation, which is expected in the first quarter of 2003. One notable exception is the Alberta Personal Income Tax Act amendments, which are retroactive to Jan. 1, 2001.
Alberta Finance was able to convince the government not to give AIPs the same rights as spouses under the Employment Pension Plans Act (EPPA) because pension plans recognizing platonic relationships cannot be registered under the federal Income Tax Act (ITA). Instead Alberta introduced the term “pension partner,” which includes common-law heterosexual and same-sex partners. Similar amendments have been made to legislation governing public-sector plans for management employees, local authorities, special forces, the public service, members of the legislative assembly or provincial judges and masters in chambers.
Changes to the Alberta Personal Income Tax Act are also not extensive since they would be inconsistent with the ITA. Furthermore the changes will not have any direct impact on group and health-care plans, since any regulatory provisions are tax driven.
Definitions
Bill 30-2 defines an AIP as a person who has lived with the other person in a relationship of interdependence for a continuous period of not less than three years or in a relationship of some permanence if there is a child of the relationship by birth or adoption. An adult interdependent partnership can also be created by agreement between two people and an agreement is required where the parties are related by blood or adoption. A married person cannot become an AIP while living with his spouse and a person can only have one AIP at a time.
Family law, wills and estates
The greatest impact of the act will be with respect to family law support provisions and wills and estates:
•The Domestic Relations Act will include a new section dealing with support orders and support agreements for AIPs. This is clearly a response to the May 20, 1999 Supreme Court of Canada decision in M. v. H. [1999] 2 S.C.R. 3 (S.C.C.). In that case, an Ontario woman challenged the definition of “spouse” under Ontario’s Family Law Act in seeking support after she split up with her partner following a five-year relationship.
•The Health Insurance Premiums Act will extend premium assistance to AIPs receiving benefits under the Seniors Benefits Act.
•Under the Intestate Succession Act surviving AIPs will have similar rights to spouses when a person dies without a will.
•The right to a property split in the absence of an agreement between the parties is not available to common law spouses and has not been extended to AIPs under the Matrimonial Property Act.
Pensions
In December, Alberta released EPPA Update 02-03 which explains the changes to the Employment Pensions Plan Act and how pension plan administrators should respond.
The most significant change contained in Bill 30-2 is the change from “spouse” to “pension partner.” This new definition, like the old one, includes a person who, at the time a right to a benefit is determined, was married to that other person and had not been separated from that person for three or more consecutive years. The significant change comes in the cases where there is no married spouse, but there is another person who is in a conjugal relationship with the member.
Under the new definition a person who, immediately preceding the time the benefit is determined, had lived with that other person in a conjugal relationship for at least three years, or in a relationship of some permanence if there is a child of the relationship by birth or adoption, is a pension partner and therefore eligible for the same spousal benefits as if they were married to the member. This definition restricts spousal benefits to those in conjugal relationships to be consistent with the ITA.
Administrators will not be required to file the amendment with the superintendent of pensions immediately after proclamation, although they may do so if they wish. They are required to file the amendment on the next occasion on which they submit other amendments or by Dec. 31, 2003, whichever is later.
It should also be noted that a plan must be administered in accordance with the legislation once it is proclaimed, regardless of whether the plan text has been amended.
Beyond conjugality
It seems somewhat ironic that, because of the ITA, government intentions were thwarted with respect to pensions and benefits which have been a key battleground in the campaign to extend rights to same-sex partners. But it is important to recognize Alberta is not the only jurisdiction that has considered enlarging the class of dependents with entitlement to various rights and benefits.
When the Law Commission of Canada’s report, Beyond Conjugality, was released in January 2002, Justice Minister Martin Cauchon said he would consider a proposal to extend federal benefits to cohabitants who are in economically dependent relationships, including adult siblings, aging parents, grown children, disabled adults and their caregivers or even old friends.
If the recommendations set out in the report are followed, the federal government would oversee a registry that would give two people in an economically interdependent relationship the option of recording their arrangement in order to become eligible for income tax breaks, pension and survivor benefits and other employment-related perks currently available to married, common-law and same-sex couples.
There have been no recent indications the federal government plans to act on these recommendations, but benefits plan sponsors and their advisors should be vigilant. If mandatory benefits coverage was expanded to include a broader class of economically interdependent relationships, plan sponsors and their advisors would have to develop innovative plan designs to control both liability and expenses.
Sheryl Smolkin is a lawyer and director of Watson Wyatt Worldwide’s Canadian Research and Information Centre in Toronto. She can be contacted at [email protected].
