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ARTICLE · 21 OCTOBER 2020

Pension "buy-back Restriction" For Part-time Employees Violates Charter

On October 16, 2020, the Supreme Court of Canada (the "SCC") released its decision in Fraser v. Canada (Attorney General) ("Fraser").

CanadaEmployment and HR

On October 16, 2020, the Supreme Court of Canada (the "SCC") released its decision in Fraser v. Canada (Attorney General) ("Fraser").1 Fraser is a significant decision that will disrupt pension plan design and administration across Canada for years to come.

Facts

Fraser involves three retired members of the Royal Canadian Mounted Police (the "RCMP") who participated in a defined benefit pension plan that was established pursuant to federal statute (the "Plan").  The benefit formula under the Plan is based on years of pensionable service multiplied by the annualized average of a member's best five consecutive years of earnings. Members receive full-time pensionable service credit for periods in which they work forty hours a week.  Members who take a leave without pay ("LWOP") for any of a variety of reasons are permitted to "buy-back" the period of service associated with the LWOP ("buy-back rights").  Buy-back rights provide a member who has taken LWOP with an

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