Pensions: Focusing on sustainable savings

Looking to provide employees with secure and valuable DB pension benefits, Torstar, SHARE and the United Way of Greater Toronto decided to try out a new type of plan

Pensions: Focusing on sustainable savings

Research shows that Canadians want and are willing to contribute to achieve secure, predictable, lifetime retirement income. Likewise, employees, unions and employers are increasingly looking for better and more secure pension options that have the best features of large defined benefit (DB) pensions without the costs and risks of traditional single employer plans. Valuable and secure DB plans have been shown to have a significant and positive impact on employee attraction, retention and engagement. 

Canadians who belong to these plans report significantly lower financial planning stress and retire on a more predictable basis allowing employers to plan better. Employers also benefit from lower stress in the workplace, which leads to lower benefit costs and absenteeism.

Torstar Corporation
Media conglomerate Torstar Corporation, a publicly traded company, and its union partners place high value on a sustainable pension benefit for employees. Its workforce was covered by a mix of defined benefit, defined contribution and group RRSP programs.

Torstar was searching for ways to manage pension balance sheet volatility, while still providing secure and valuable defined pension benefits for all employees. So, in 2018, the 3,400 Torstar defined benefit (DB) members voted 97 per cent in favour of merging with the CAAT Plan.

CAAT’s DBplus offers organizations the flexibility to select a contribution rate that ranges from five per cent to nine per cent, matched by the employer. The higher the contribution rate, the better the pension. CAAT also allows groups that currently have no or low contributions to gradually phase in to their ultimate desired fixed contribution rate.

The DBplus pension is paid for life and includes features such as conditional inflation enhancements in retirement, subsidized early retirement and no-cost survivor benefits. Members also have the option to consolidate their retirement savings by purchasing additional pension in DBplus where permitted.

“We were attracted to the CAAT plan by the opportunity to replace fluctuating and sometimes unpredictable funding requirements under our plans by the much more predictable funding profile associated with DBplus,” says Lorenzo DeMarchi, executive vice president and CFO of Torstar in Toronto.

Torstar employees are a mix of non-bargaining and bargaining staff represented by two unions — Unifor and Teamsters. In all, there are about 5,400 Torstar employees, and their contribution rates for DBplus are at nine per cent for former DB members and five per cent for all other employees.

The pension merger with the CAAT Pension Plan allowed Torstar to exit the pension risk management business and eliminate defined benefit pension volatility on its balance sheet, thereby providing an overall benefit to its business.

“Being part of a plan that has significantly greater scale and is managed by a team of people that are solely focused on providing defined pension benefits was also attractive to us. With our pension benefits now being administered by CAAT, management has more time to focus on our core business,” says DeMarchi.

United Way of Greater Toronto
Looking to improve its pension plan, the United Way of Greater Toronto merged its single employer pension plan with CAAT in 2019. The non-profit organization’s more than 200 employees voted 99 per cent in favour of joining. United Way employees earn a defined benefit pension through CAAT’s DBplus going forward, while pensions earned to the date of the merger are replicated and administered by CAAT.

After a brief phase-in period, member pension contributions will be fixed at six per cent of income, matched by the employer. Once fixed, the contribution rate can never change, regardless of the funded status of the plan.

“This move has allowed us to improve the pension plan we offer to our employees, helping ensure long-term, sustainable and secure retirement savings,” says Rahima Mamdani, vice president of people and culture at the United Way.

Employers that are relatively small have also joined CAAT. Fourteen employees at SHARE (Shareholder Association for Research and Education) led the search for a new retirement savings program. The employer was already contributing five per cent of base earning to employees’ RRSP of choice, but it felt it was impossible to access pension plans that were generally only available to larger organizations. DBplus allowed employees to “trade up” to a secure and valuable defined benefit pension at no additional cost to SHARE.

“SHARE advocates for expansion of retirement benefits for all Canadian workers, but our own non-profit sector has historically been particularly disadvantaged in providing stable retirement options for employees,” says Kevin Thomas, CEO of SHARE in Toronto. “[The DB Plus plan] gave us the opportunity to offer a secure pension promise for SHARE staff that builds on our own commitment to a sustainable, unionized, living-wage workplace.”

SHARE has offices in Vancouver and Toronto, and it works with a growing network of institutional investors, helping them to develop and implement responsible investment policies and practices. CAAT’s responsible investing policies and approach are aligned with SHARE’s organizational focus, specifically, an emphasis on proxy voting, corporate engagement and encouraging the integration of environmental, social and governance (ESG) factors in the investment process.

“DBplus is sustainable and portable, and CAAT’s own advocacy for defined-benefit pensions in Canada is aligned with our values as an organization,” says Thomas.


Derek W. Dobson is CEO of the CAAT Pension Plan in Toronto. For more information, visit






3.2 million
Number of women with a registered pension plan (RPP) in 2017

3.1 million
Number of men with an RPP in 2017

4.2 million
Number of paid workers covered by a defined benefit (DB) pension plan in 2017, up 0.7% from 2016

1.2 million
Number of workers with a defined contribution (DC) pension plans in 2017, up by 3.5% from 2016

Percentage of RPP members with a DB plan in 2017

Percentage of RPP members with a DC plan in 2017

Source: Statistics Canada


4 in 5
Number of U.S. and Canadian workers and retirees with pension plans who said the availability of pension benefits is a critical factor in deciding whether or not to accept a job  (handshake)

Number of respondents who said they stayed with an employer due to pension benefits (person at desk)

Number of respondents who said they want more help with retirement planning (calendar)

Number of respondents who said they would like retirement coaching (whistle)


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