Case Note: New Pension Plan Not "Equivalent In Value"

The Supreme Court held in Telecommunications Employees Association of Manitoba Inc. v Manitoba Telecom Services Inc.,2014 SCC 11 that an employer was not entitled to take a contribution holiday relying on an actuarial surplus of pension funds originating solely from member contributions. In this case, privatization of the employer had been accompanied by the creation of a new pension plan. The plan was required by statute to provide benefits "equivalent in value" to the old plan. The Court held that this required more than a simple comparison of the amount paid each month to plan members under each pension plan. Equivalency in value also contemplated that the means by which the benefits were funded be equivalent or that additional benefits be provided to compensate for any funding inequalities. The surplus was to be credited entirely to the employees; as a result, the employer had not matched the members' contributions at the relevant date and had failed to comply with