New legislation – VRSP
Employment Insurance – change to the waiting period
6 September 2017
What is a VRSP?
The new legislation requires Quebec employers to establish a workplace pension plan.
The Voluntary Retirement Savings Plan (VRSP) is a new retirement savings plan for small and medium-sized businesses and the self-employed.
This plan is mandatory for employers who do not already offer a group retirement plan to their employees. Targeted employers must provide their employees with a Workplace Retirement Savings Plan in accordance with the following schedule:
| Number of employees | Employee count as of | Deadline |
|---|---|---|
| 20 & more | June 30, 2016 | December 31st 2016 |
| From 10 to 19 | June 30, 2017 | December 31st 2017 |
| From 5 to 9 | To be determined by the government | Nor before January 1st 2018 |
VRSP Implementation Process
- The Government of Quebec requires employers to send a memo to their employees, notifying them at least 30 days in advance, of their intention to subscribe to a VRSP.
- The employer completes an account opening for VRSP with the supplier of his choice
- The selected supplier will send a kit to each eligible employee advising them of their automatic VRSP membership. If they wish to withdraw, they must notify their employer and the supplier. The supplier will give employees 60 days to withdraw or to modify the percentage of their contribution..
- Once the list of employees has been finalized, the employer can start the payroll deduction.
Important note about VRSP
The employer has to do a follow-up with their employees every two years (the ones who opt out) to remind them that a plan is in place and available to them.
- Group Registered Retirement Savings Plan (RRSP)
- Combined Group Registered Retirement Savings Plan (RRSP) and Deferred Participation Plan (DPSP)
- Simplified Retirement Plan (SPP)
We will be discussing alternative VRSP pension plans in our next blog.
