The structure of the TCPP allows a great deal of flexibility. Divisions can be added and new members can become part of existing divisions as demand increases.
The principle components of the structure are the Board of Trustees, its Sub-Committees, Divisional Retirement Committees and the various professional advisors and agents that are called upon by the Board and its committees to help carry out their activities. The TCPP is registered in Ontario and as such, certain requirements must meet the Ontario Pension Benefits Act as regulated by the Financial Services Commission of Ontario. However, as the TCPP has members across multiple jurisdictions, members’ benefit entitlements are subject to applicable federal or provincial pension standards legislation. Also, the Canada Revenue Agency ensures that the TCPP complies with the rules under the Income Tax Act.
Board of Trustees
The Board of Trustees is the ultimate level of authority of the TCPP. Its role is to ensure assets get the best possible rate of return at an appropriate level of risk for each Division, to oversee maintenance of proper funding for each Division’s benefits, to review any changes proposed by the Retirement Committees and to ratify them. The Board is ultimately responsible to all pension plan members and pension regulators.
The Trustees are Union or Union and Employer representatives from each Division. The Board meets at least twice a year to address any new and ongoing business brought to its attention.
Created to deal with the preliminary work on important matters needing in-depth analysis, sub-committees review the material on specific subjects and make recommendations to the Board. Currently, there are four sub-committees:
The Investment Sub-Committee reviews investment results, trends, and fund managers’ reports to determine if any changes should be recommended to the Board. This approach has contributed to the fund’s favourable investment performance since the creation of the committee.
The Communication Sub-Committee is responsible for the overall communication strategy for the plan. It ensures that members, employers, union representatives and other interested parties receive accurate and useful information about the TCPP.
The Governance and Performance Sub-Committee ensures the plan has a good pension management system, meaning effective processes exist that encourage sound decision making, proper and timely execution of these decisions, and regular review and assessment of all aspects of the plan.
The Audit and Actuarial Assumptions Sub-Committee reviews the draft audited financial statements and the funding strategy, including the assumptions recommended by the plan’s actuary to estimate the TCPP’s assets and liabilities. It ensures controls are in place to prevent errors, inefficiencies and fraud.
Divisions and Divisional Retirement Committees
Action rests at the divisional level. A Retirement Committee of Union or Union and Employer representatives governs each Division. Divisions are made up of groups that may share common bonds. A number of individual pension plans have merged with the TCPP to benefit from its fiscal and benefit cost advantages.
Divisional Retirement Committees address the requests and needs of their members on an ongoing basis and define any required changes to plan provisions. Each Committee has considerable autonomy in its role of operating the pension plan for its members. For example, the Committee is free to recommend the appointment by the Trustees of a pension administrator of its choice and has the responsibility to develop its own investment policy, in accordance with the rules and procedures set by the Board of Trustees.
Committees must, however, report their decisions to the Board for final ratification before implementation. In this way, the Board can ensure that Committee decisions are sound and consistent with legislation as well as the overall principles and objectives of the TCPP.
Professional Support Provided by Specialists
Divisional Retirement Committees are required to use the professional auditing, legal, actuarial, fund management, custodial, and any other similar services selected by the Board. This consolidation gives each Division cost advantages resulting from purchases of selected services by a large group.
Specialists provide expertise to the TCPP as a whole. Because of its size, the TCPP can afford to use the best possible consulting expertise available to support the Board and individual Divisions in managing the plan. This way, the Board ensures the viability of the plan and supports its mission of providing the best possible pension with a high degree of certainty from the contributions made by and on behalf of members.
Under the TCPP, there are four different divisional administrators, responsible for the day to day operations of the plan, including member communications.
PBI ACTUARIAL CONSULTANTS LTD.
LES SERVICES D’ADMINISTRATION DE TEAMSTERS QUÉBEC LTÉE
BENEFIT PLAN ADMINISTRATORS LIMITED
TEAMSTERS’ UNIONS ADMINISTRATION SERVICES INC.