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PENSION PLANS
As of November 18, 1999, Eaton's stopped administering all of its pension
plans. As a result, the Ontario regulator of pensions, the Superintendent of
Financial Services, appointed PricewaterhouseCoopers Inc. ("PwC") as the
administrator of all Eaton's plans.
PwC retained the actuarial firm of Towers Perrin to continue with the
day-to-day administration of the pension plans. As of August, 2001 PwC
terminated the engagement of Towers Perrin and Towers Perrin discontinued its
hotline and is no longer answering pension queries from employees.
If you have any questions about the Eaton's pension plans, please call PwC:
1-800-431-5711.
PwC wound-up the pension plans and filed wind-up reports with the provincial
pension regulator, the Financial Services Commission of Ontario. The reports
have been approved by the Superintendent of Financial Services. Option
statements were sent out by Towers Perrin to members requiring members to
choose where they wished to have their pension benefits transferred.
The current status of each of the plans are as follows:
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Eaton Superannuation Plan ("ESP"): all benefits have been
distributed and annuities purchased for members. This plan had a surplus. The
law firm of McDonald & Hayden and actuarial consultants Watson Wyatt dealt
directly with the Liquidator with respect to sharing the surplus with plan
members and the estate of Eaton's.
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ERAP 2: Most benefits have been distributed and annuities purchased
for members. We are advised that some surplus is anticipated and if so, it will
be paid out to members in cash after all pension liabilities have been dealt
with.
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ERAP 3: Most benefits have been distributed and annuities purchased for
members. This plan does not have any surplus. Members will not receive a
surplus distribution.
ERAP PARTIAL WIND UP CLAIM
We identified that certain employees who were members of the ERAP Pension Plan
and who were terminated prior to August 20, 1999 were promised an additional
surplus distribution by Eaton's as part of their termination package. The
amount was approximately 80% of the first component of surplus that had been
paid to the employees as part of the partial wind up of ERAP several years
before. The partial wind up was never completed and the pension plan went into
full wind up and there was no surplus remaining. However, as Eaton's had
promised to pay a portion of the surplus to certain employees as part of their
termination package we filed a claim for the unpaid surplus. The Liquidator
disallowed this claim. We proceeded to a claims hearing before Claims Officer
Joseph O'Brien (formerly of the Ontario Superior Court of Justice) who ruled
the claim valid. The Liquidator appealed to Mr. Justice Farley who upheld the
decision of Claims Officer O'Brien and confirmed that the claim was valid.
Richter has released dividend payments to the eligible employees.
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