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LAPP Governance Then and Now

Pensions are an important benefit offered by LAPP employers as part of overall employee compensation. It has always been important to members, who pay every month toward their future retirement, that LAPP is well governed, now and into the future. In this section you'll find a summary of LAPP’s governance before and after the Plan’s March 1, 2019, transition to joint governance.

Then: LAPP Inception in 1962 up to Plan Independence in 2019

From 1962 to March 1, 2019, when LAPP’s transition to a new governance structure became effective, the primary oversight function of the Plan belonged to an external authority. This person was also the trustee and administrator of LAPP and responsible for the LAPP fund. LAPP members and employers, who have always paid contributions into the Plan, did not have a final say in how the Plan was managed.

Within the pre-reform governance model of the Plan, the LAPP Boards and the executive team successfully managed the delegated operations of the Plan and showed a commitment to providing a secure retirement for Plan members at a reasonable cost.

LAPP members and employers held all the risks associated with funding LAPP, a Defined Benefit (DB) plan, including the risk of investment losses that may have necessitated changes to contribution rates and/or benefits, but without final determination on any changes to LAPP or ultimate control of the Plan.

By the 2000s, most Canadian public sector plans had already received their independence and successfully moved into a joint governance arrangement. For many years, LAPP stakeholders wanted more say in how their pension plan was managed. Though some reform attempts were initiated, no mutually satisfactory agreement on change was ever reached.

Now: An Independent LAPP Beginning March 1, 2019

In late 2018, Bill 27, the Joint Governance of Public Sector Pension Plans Act, was passed into law with Bill 27 transitioning LAPP to joint governance effective March 1, 2019.

The new joint governance framework eliminates key risks to the Plan, clarifies roles and responsibilities, and, most notably, gives Plan sponsors (the members and employers who pay for the Plan) a direct role in decision making. Equal say given to those who pay for the Plan is evidenced in the new governance framework.

The Sponsor Board, responsible for decisions about Plan benefits and setting contribution rates, is appointed by the Plan sponsors. LAPP Corporation, which includes a Corporate Board that is also appointed by Plan sponsors, is now the administrator and trustee of LAPP.

LAPP Governance Structure



LAPP continues, with no changes to benefits or how the Plan is funded. Only the governance has changed as a result of the transition. Retired member benefits have not and will not be impacted in any way, and the Sponsor Board is required to consider the interests of retired Plan members before making decisions.

In the page titled Joint Governance: A Best Practice, we explore the benefits of joint governance and why it's regarded as best practice.

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