There has never been a more exciting time to study pension law. The current economic climate has catapulted pensions onto the front pages of major newspapers. Government commissions and review panels have made pensions a top priority. Pension statutes across the country are being revised and updated, some for the first time in twenty years. The Supreme Court of Canada has heard and decided a half a dozen pension cases in the past decade, as opposed to just one in the decade before that. The law in this area is dynamic.
One of the challenges of pension law is the difficulty in which to pigeonhole it into our conventional regulatory mindset. Legal regimes that import a regulatory component are often described by reference to one of two broad purposes: one, statutory schemes the predominate purpose of which is to deliver a social program by either conferring a social benefit or regulating social behavior, or two, schemes that regulate economic behavior with the objective of providing stability and fairness in capital markets or correcting a perceived imbalance in those markets. These conventional assumptions are simply inadequate or inapplicable in the case of pensions. On one hand, the establishment of an employer-sponsored pension plan is a voluntary exercise and, therefore, a pension plan will often exist purely as a function of contract. On the other hand, provincial pension legislation originally required employers to establish a pension plan for their employees. This was a policy initiative that intended – and to an extent still intends, notwithstanding its voluntariness – to download onto the private sector the delivery of a social program, albeit regulated by government. Pension law exploits the dichotomy between these two rationales: one rationale being that the law should aim to defer as much as possible to common law contractual rights, and the other being that the law should reinforce the public policy objectives relating to pensions by ensuring a minimum level of sustenance following an employee’s working life. In this course, we will consider this dichotomy as we explore the nature of pension plan sponsorship, administration, investment, regulation, amendment, reorganization, termination and surplus.
