If you have gone through a relationship breakdown, we are sorry to hear it. There are several things to know when it comes to your pension and it can get rather technical, but we are here to help you.
If you separate or divorce, it is very important that you contact us as soon as possible.
It is also suggested that you find an independent representative who can give you legal advice. You will want to direct your representative to the website of LAPP’s benefit administrator, Alberta Pensions Services Corporation (APS), which contains more detailed information on this topic.
A member's pension is considered matrimonial property which can be divided. It is very important to note that not every separation or divorce results in a member's pension being divided. You and your spouse can agree that other assets of equal value can cover anything owed, or you and your spouse might agree not to divide anything at all, which would leave your LAPP pension unaffected.
Whatever you and your spouse decide to do regarding your LAPP pension, please let us know as soon as possible.
Common-Law-Type Relationship Breakdown
Common-law-type relationships (legally called adult interdependent partnerships) are not covered by the Matrimonial Property Act
. That means that in cases involving a common-law partner, pension benefits are not
matrimonial property and cannot be divided.
If you and your common-law partner separate, you should contact us as soon as possible. The separation can affect your pension. A legal document called a statutory declaration makes us aware of the change and allows us to update your pension partner information.
Marriage Relationship Breakdown
If you are married and are considering a separation or divorce, an important first step is determining the value of your pension. A Total Entitlement estimate
can be requested from us in writing. It is a statement of the value of your LAPP pension benefit at the time the marriage breaks down.
Note that when a member requests a Total Entitlement estimate, the spouse or partner is also sent an estimate. Contact us for information about the request and how to submit it. The non-member spouse can also request this estimate.
Written requests must have the following information:
- the signature of the person requesting the estimate;
- the full names, current addresses, and current phone numbers of both the LAPP member and the spouse. (Please note, a current address and phone number can be care of a lawyer);
- an estimated beginning and end date for the period of joint accrual (this is normally the time the parties were married or living together). This date must be either a date before the request, or the date of the request; and
- if the request is from, or is to go to, a LAPP member's lawyer, a release document, signed by the LAPP member, that permits the release of the estimate to that lawyer; and
- if the written request is from, or is to go to, a non-member spouse's lawyer, the non-member spouse must sign a document allowing the release of the estimate to that lawyer.
In order to divide a LAPP pension between you and your spouse, we require a matrimonial property order (MPO or order) that complies with the Plan rules. Please provide us with a draft order to review so we can make sure that we can follow the terms of the order.
The spouse or partner’s share is limited to 50% of the value of the benefits that were earned during the period of joint accrual. That is normally the time you were married and not separated. Your LAPP pension entitlement will then be reduced accordingly.
If the LAPP member spouse is vested
(entitled to a pension) at the end of the period of joint accrual and is also within 10 years of turning 65, the non-member spouse can choose to delay the calculation and distribution of the value of the pension benefits until the member:
- begins the LAPP pension;
- triggers a benefit payment on leaving the Plan;
- completes a reciprocal transfer; or
- passes away.
- Share of pension payments: If the member's spouse is entitled to division of the member’s pension payments, the member's monthly pension payments will be split according to the division outlined in the MPO. The funds will be paid monthly and directly to the non-member spouse. A lump-sum payment to the non-member spouse is not an option.