Amendments cover automatic contributions, spousal protections, executive plans
British Columbia is updating its pension standards legislation this year, with a series of amendments to the Pension Benefits Standards Act (PBSA) coming into force in two stages — some on April 30, 2026, and others on Oct. 30, 2026.
The changes introduce automatic contribution escalation for defined contribution (DC) plans, expanded options for surviving spouses, and relief for employers offering individual pension plans to high earners.
Announced previously, the regulations are bringing the amendments into force, says Meghan Popp, partner in the pension and employee benefits group at Lawson Lundell.
Overall, the changes reflect an effort to keep pension regulation proportionate, she notes — particularly for smaller employers who may find compliance burdensome.
"There's always a concern that there's, especially in DC plans, a bit of over-regulation — that if we make it too burdensome to offer these plans, then they'll just go to a group RRSP or some other kind of arrangement.
“So [it’s about] a fine regulatory balance that… hopefully doesn't drive them out of the space because pensions are valuable to employees.”
Automatic escalation makes saving easier
Among the most significant changes for everyday plan members is the introduction of automatic contribution escalation. Under the new framework, member contributions in DC plans can increase automatically over time, up to the level of maximum employer matching, unless the member opts out after receiving notice.
“There could be contribution schemes where employers, employees can participate at different levels, but it would be an opt-in each time,” says Popp.
“Now, this is removing that paperwork, just making it easier.”
That reduces a burden on members so they don't have to fill out paperwork each year to increase their savings, “making it a lot easier to get those funds into the plan,” she says.
“The DC auto escalation piece is [about] more flexibility for employers and how they design their plans.”
The option is available to employers that already allow automatic enrollment in their plans, she says: "A key piece will be communication to the members, as with any plan design change. Communicate clearly.”
New options for spouses
The amendments also expand rights for surviving spouses of plan members who die before retirement. Currently, plans can require that a spouse simply receive a lump-sum transfer but under the new rules, defined benefit (DB) plans must offer surviving spouses the choice of a pension paid directly from the plan, in addition to the transfer option.
"Now, all plans have to offer that spousal pension option," says Popp — though exceptions remain, and DC plans, which don't pay pensions directly, are still exempt.
Plans will also be required to offer members and spouses more transfer options when leaving a plan — including transfers to a life income fund or an individual annuity policy, she says.
“A lot of plans don't offer that because it's administratively difficult to do, especially with the annuity purchase. There's lots of income tax act rules, but the change now requires plans to offer those options.”
While the new transfer requirements will put some additional burden on employers and their administrators, most plan administration is handled by third parties, says Popp.
“It's something that they have to be aware of, figure out, to make sure… that they’re implementing those changes.”
Executive plans exempt from registration
The April 30 changes affect specified individual plans (SIPs) — DB plans for high-earning or non-arm's-length employees. A 2015 requirement to register these plans with the BC Financial Services Authority has been reversed.
"Plans that are for connected members but also for high earners, if they meet a certain earning threshold, they can be exempt from the registration under the PBSA," says Popp. "It just gives… employers more leeway on how they operate those plans without regulatory oversight."
The registration requirement had created cost and administrative challenges in sectors such as construction and mining, where such plans are used to attract and retain executive talent, according to the B.C. government. Removing it will save employers registration fees as well as the ongoing cost of annual disclosures.
Restoring the exemption to cover plans for all specified individuals removes a significant barrier, said Spenser McCaig, senior consultant at Westcoast Actuaries, in a release.
“Bill 33 provides significant relief from the administrative burden on these plans, allowing a more flexible and simplified pension arrangement for executive staff."
Variable life benefits still pending
One anticipated development that did not make it into this round of changes is variable payment life annuities (VPLAs) — a mechanism that would allow DC plan members to receive a lifetime pension paid directly from their plan.
While legislation enabling VPLAs was introduced in B.C. in 2023, the accompanying regulations have not yet been finalized, says Popp.
"The regulators… are trying to be consistent across Canada in how they implement those — the regulators are talking and are trying to do a harmonized introduction of those rules," she says. For now, employers with DC plans will have to wait.
Pension governance
For employers with pension plans in B.C., the amendments will mean engaging governance duties and reviewing plan documents, according to Popp.
"Plan text amendments are going to be needed for some of those new options if the plan isn't already doing it."
Employers should also confirm that any third-party administrators are aware of and implementing the new requirements.
The amendments complete B.C.'s implementation of a 2008 joint expert panel report developed in collaboration with Alberta, according to the province. Bill 33, which authorized the amendments, received royal assent in November 2023. A provincial election in the interim contributed to a delay before the regulations were finalized, says Popp.
Steven Frank, president and CEO of the Canadian Life and Health Insurance Association, says the amendments will have broad benefits: "These changes will help strengthen retirement security in the workplace by making it easier for British Columbians to save for retirement and reducing administrative burden for employers."
