Skip to content

Reunited and it feels so good: pensions, benefits and New Brunswick’s Unclaimed Property Act

Christopher Marr, TEP and Lauren Henderson

Each year in New Brunswick, millions of dollars sit in limbo: unpaid wages, forgotten security deposits, overpayments to debt collectors, and benefits from estates, pensions and employee benefit plans, to name a few. To address this issue, New Brunswick has become the fourth province in Canada to implement an unclaimed property regime with Bill 22, also known as the Unclaimed Property Act (“Act”), receiving Royal Assent on March 17, 2020. The Act aims to reconnect individuals with their forgotten or misplaced financial assets (“Eligible Property”) while reducing the cost, liability and uncertainty placed upon the holders of such assets, including employers and pension and employee benefits funds.

The regime operates in a manner similar to its federal counterpart, which requires banks to turn over to the Bank of Canada money found in inactive accounts of un-locatable persons. The Bank of Canada then holds the funds for a specified period.

In New Brunswick, holders of Eligible Property will be required to hold on to it for a period of time to be specified in regulations, after which the property will be presumed unclaimed. Holders of unclaimed property must then: provide notice to the last known address of the owner, and if no claim is made by the owner, report and remit the unclaimed property to the Director of Unclaimed Property (“Director”). A holder’s failure to report can result in interest and late fees. The program is also available, at the discretion of the Director, to holders on a voluntary basis.

Once the holder fulfills its duties under the Act, the holder is relieved from liability and the Director becomes the custodian of the property. The Director will maintain a searchable directory, allowing owners to identify and claim any unclaimed property held in their name. Any property that remains unclaimed may be used to assist in the administration of the program and any other consumer protection initiatives.

This is a welcomed solution to an ongoing problem for active and terminated pension plans alike. In contexts such as pension plan terminations, mandatory commencement of benefit payments and retiree or plan member deaths, an un-locatable member places a practical burden and expensive fiduciary obligation on plan administrators who need to hold on to funds and determine what to do with them, for what could be an indefinite period of time. The Act will now allow plan administrators to move any funds that belong to an un-locatable plan member and otherwise meet the requirement of the Act over to the Director.

While this is a step in the right direction, plan administrators should still consider what can be done on their end to limit potential problems associated with un-locatable persons, such as:

  • Establish and implement a plan records management policy to ensure member information remains accurate (including reminders in member communications);
  • Establish a missing members policy (standards for searching for members); and
  • Establish procedures to address late commencement of pensions where missing persons are found.

Roles/responsibilities as well as suggested steps to be taken after an unsuccessful search are also set out in the Canadian Association of Pension Supervisory Authorities’ (CAPSA) Guideline No. 9 on Searching for Un-locatable Members of a Pension Plan.


This article is provided for general information only. If you have any questions about the above, please contact a member of our Pensions & Benefits Group.

 

Click here to subscribe to Stewart McKelvey Thought Leadership.

SHARE

Archive

Search Archive


Search
Generic filters

 
 

The Winds of Change (Part 4): A Review of Rental and Royalty Regimes for Wind Development on Crown Lands: Options for Newfoundland and Labrador’s Economic Wind Policy

August 3, 2022

By: John Samms, Sadira Jan, Paul Kiley, Dave Randell, Alanna Waberski, and Jayna Green As we explained in our July 6, 2022 “Winds of Change” article, the announcement made by Minister Andrew Parsons on April…

Read More

Update on the Economic Mobility Program for Refugees (phase 2): The Economic Mobility Pathways Project (“EMPP”)

August 2, 2022

Included in Beyond the Border – July 2022 By Brittany Trafford; Fredericton   Brief Overview In an attempt to address the Canadian labour market shortages, the Economic Mobility Pathways Pilot (“EMPP”), was introduced in 2018.…

Read More

HR Best Practices When Employing Foreign Workers

July 29, 2022

Included in Beyond the Border – July 2022   By Brendan Sheridan; Halifax Canadian employers are increasingly relying on foreign workers to fill gaps in the labour market and to provide specialized skills. In 2020,…

Read More

Beneficial Ownership Registry Rules Come to New Brunswick

July 28, 2022

By Alanna Waberski, Graham Haynes and Maria Cummings On June 10, 2022, the Government of New Brunswick proclaimed into force Bill 95, which amends the Business Corporations Act (New Brunswick) (the “NBBCA”) to require corporations…

Read More

Recent trends in defined benefits pension plans – a review of public sector plans

July 28, 2022

Included in Discovery: Atlantic Education & the Law – Issue 10 Hannah Brison and Dante Manna Increased financial volatility caused by recent global events has caused public sector defined benefit (“DB”) pension plans to reflect…

Read More

Atlantic Canada offers immigration pathways for workers in Trucking, Health, Construction and Food Service Industries

July 27, 2022

Included in Beyond the Border – July 2022 By Sara Espinal Henao; Halifax It is a well-known fact that Atlantic Canada needs workers. In the aftermath of COVID-19, regional employers in the trucking, health, construction,…

Read More

The winds of change (part 3): Newfoundland and Labrador releases wind energy guidelines

July 27, 2022

By: John Samms, Matthew Craig, Dave Randell,  and Jayna Green On July 26, 2022 the Province of Newfoundland and Labrador (the “Province”) released “Guidelines: Nominating Crown Lands for Wind Energy Projects” (the “Guidelines”). Described as…

Read More

Trends in tenure and promotion for unionized employers

July 25, 2022

Included in Discovery: Atlantic Education & the Law – Issue 10 By Kate Profit    Tenure is a well known and often discussed topic amongst academics. Viewed by unions as a cornerstone of modern universities,…

Read More

Car-Sharing Comes to PEI – Insurance Implications

July 22, 2022

Dalton McGuinty Jr. and Kegan Bradley On May 17th, 2022, Canada’s largest car-sharing company, Turo, brought their platform to Prince Edward Island. The service allows car owners (lessors) to lend out their vehicles to drivers…

Read More

Federal Government announces significant investments in Nova Scotian clean energy initiatives

July 21, 2022

Nancy Rubin & Tiegan Scott On July 21, 2022, the Federal government announced a new investment of up to $255 million for clean energy initiatives in Nova Scotia. The funds will be allocated in two…

Read More

Search Archive


Search
Generic filters

Scroll To Top