What’s considered re-employment

What counts

Teaching isn't the only type of work that counts as re-employment. For plan purposes, your work after retirement is subject to the re-employment limit if you:

• Work, or are otherwise engaged in an activity, in any capacity for:

  • a school board in Ontario;
    
  • a designated private school; 
    
  • a designated organization; or
    
  • the Ministry of Education*.
    

• Work as a teacher (includes, but isn't limited to, tutor, guidance counsellor, librarian, vice-principal, principal or other supervisory officer positions):

  • under an authorized exchange program;
    
  • for an Ontario government ministry; or
    
  • for the Toronto and Region Conservation Authority. 
    

• Work as a volunteer and you're entitled to compensation (including gifts or honorariums) for the position or activity (applies even if you don't accept payment to which you're entitled).

Working for more than a year – option to recalculate your pension

You may be able to increase your pension if you haven't worked any re-employment since you started your pension. You can choose to stop your pension and have additional service count toward it. To be eligible for this recalculation option, you must:

• notify us to suspend your pension before you first begin any re-employment work*; and
• stop your pension until you've accrued at least one year of credited service.

* If you’re unsure whether an activity for which you’re entitled to compensation counts as re-employment, contact us before you begin. For example, certain types of volunteer or professional development activities could count as re-employment work.

If you choose to recalculate your pension, you'll contribute while you're working. When you're ready to restart your pension, we'll recalculate it with the additional credit, based on pension rules in effect at the time. While this will usually result in a higher pension, in rare circumstances it can lower benefits for you or your survivors.

Disability pensions and re-employment

If you're receiving a disability pension and return to work, you can also choose to have your pension recalculated. To be eligible, the same rules above apply except for how long you must work. 

To have your pension recalculated, you must work for the equivalent of two years or more.

Volunteer work

The re-employment rules may apply even if you don't get paid for your work. You can't forfeit your pay to circumvent the rules. If the position or duty entitles you to compensation and you decide to decline it, your service will still count toward the limit. Keep in mind that payments for services rendered may include gifts and gift certificates.

To determine if volunteer work for a participating employer counts toward the limit, ask yourself the following questions:

• Are you paid for this activity or entitled to payment and choose to forfeit it?
• Have you been paid for performing this activity in the past, in and of itself?

Self-employment and third-party arrangements

There are times when you may not work directly for an employer who participates in the plan. If you've made self-employment or third-party arrangements to work after retirement and are unsure if the work is subject to re-employment rules, ask yourself these questions:

1. Are the services you provide normally performed by an employee at the participating employer?
2. Does a participating employer assign and control your duties?

If you answer “yes” to either of the above, then your work after retirement is likely subject to re-employment rules. Here are three examples to help illustrate the difference between what is and isn't considered re-employment.

Example 1 – Mary, caterer

After retiring, Mary started her own catering business, Just Like Home. Once a week, she delivers hot lunches to a few of the local elementary schools. As a retired teacher, Mary especially enjoys visiting her school clients.

Does it count?

No. The school, the participating employer, doesn't control the services provided by Just Like Home. In addition, Mary's service as a caterer wouldn't normally be performed by an employee. Therefore, Mary wouldn't have to count any of this time toward the limit. Mary's situation is an example of self-employment.

Example 2 – George, teacher program co-ordinator

George works part-time for Reach for the Top, a private company that provides teaching services in schools.

Does it count?

Yes. Any school that hires employees from Reach for the Top directly controls the services provided by the company. In addition, George's service would normally be performed by an employee rather than contracted out. Therefore, he would have to count his work toward the limit. George's situation is an example of being engaged indirectly through a third-party arrangement.

Still not sure?

You should always contact us before you begin working after retirement if you're unsure whether re-employment rules apply to your situation. Where questionable situations are discovered, we'll consider the work after retirement subject to the re-employment rules if the arrangement is in place to escape the application of the re-employment rules.