Quebec adopts measures for older workers
Quebec is once again tapping into its toolbox to help workers aged 65 and over stay employed; several measures are planned to this effect in the budget tabled Tuesday by Minister Eric Girard.
The goal is to help reduce labour shortages, but also to ensure better income security in retirement.
First, it is confirmed: Quebec is not raising the minimum age of eligibility for retirement from 60 to 62. The consultations held on this subject in February had reached a consensus to this effect within employers' and trade union organizations. Flexibility must remain in place, according to the particular situation of each worker, they said.
However, Québec is raising the maximum age of eligibility for the Québec Pension Plan pension from 70 to 72, effective January 1, 2024.
To help workers aged 65 and over stay employed, Québec will allow them to stop contributing to the QPP while receiving a retirement pension.
This will apply to both the employee's and the employer's contribution.
Currently, a worker is required to contribute to the Québec Pension Plan even if he or she is receiving a retirement pension. The maximum contribution is $4038.40 per year for an employee and $8076.80 for a self-employed worker.
A person aged 65 and over with a work income of $15,000 who decides to take advantage of this optional contribution will see his disposable work income reach $10,457 instead of $9851, or $606 more, according to the documentation accompanying the budget.
"Although it is generally advantageous to continue contributing to the QPP after age 65, many workers want to stop contributing and benefit from short-term liquidity rather than a supplement to the retirement pension," explains the documentation accompanying the budget.
Another measure of interest: the calculation of the pension will be modified as of January 1 to better protect workers aged 65 and over.
The pension is calculated on the basis of average work earnings. However, a worker aged 65 and over who decides to continue working, but on a part-time basis, would see his income decrease, and therefore the average of his work earnings decrease.
And it is used to calculate his pension.
To avoid this ripple effect, Quebec will change its calculation method to ensure that the lower years of income from age 65 will not reduce the average earnings used to calculate the pension.
"This measure will protect the pensions of more than 12,000 workers aged 65 or over," says the documentation accompanying the budget.
The government will also expand the role of Retraite Québec by asking it to conduct research on the financial situation of retirees and the retirement system in general.
Lia Lévesque, The Canadian Press
First, it is confirmed: Quebec is not raising the minimum age of eligibility for retirement from 60 to 62. The consultations held on this subject in February had reached a consensus to this effect within employers' and trade union organizations. Flexibility must remain in place, according to the particular situation of each worker, they said.
However, Québec is raising the maximum age of eligibility for the Québec Pension Plan pension from 70 to 72, effective January 1, 2024.
To help workers aged 65 and over stay employed, Québec will allow them to stop contributing to the QPP while receiving a retirement pension.
This will apply to both the employee's and the employer's contribution.
Currently, a worker is required to contribute to the Québec Pension Plan even if he or she is receiving a retirement pension. The maximum contribution is $4038.40 per year for an employee and $8076.80 for a self-employed worker.
A person aged 65 and over with a work income of $15,000 who decides to take advantage of this optional contribution will see his disposable work income reach $10,457 instead of $9851, or $606 more, according to the documentation accompanying the budget.
"Although it is generally advantageous to continue contributing to the QPP after age 65, many workers want to stop contributing and benefit from short-term liquidity rather than a supplement to the retirement pension," explains the documentation accompanying the budget.
Another measure of interest: the calculation of the pension will be modified as of January 1 to better protect workers aged 65 and over.
The pension is calculated on the basis of average work earnings. However, a worker aged 65 and over who decides to continue working, but on a part-time basis, would see his income decrease, and therefore the average of his work earnings decrease.
And it is used to calculate his pension.
To avoid this ripple effect, Quebec will change its calculation method to ensure that the lower years of income from age 65 will not reduce the average earnings used to calculate the pension.
"This measure will protect the pensions of more than 12,000 workers aged 65 or over," says the documentation accompanying the budget.
The government will also expand the role of Retraite Québec by asking it to conduct research on the financial situation of retirees and the retirement system in general.
Lia Lévesque, The Canadian Press
