Overview

This directive outlines the Government of Alberta's policy, and pension plan rules, for membership, pensionable salary and calculating pensionable service under the Public Service Pension Plan (PSPP), Management Employees Pension Plan (MEPP) and the Management Supplementary Retirement Plan (SRP). This policy will be applied fairly and equitably throughout the Government of Alberta.

Pension plan membership

Pension plan participation will commence immediately for eligible employees. Eligibility for pension plan participation for part-time, temporary and fixed term contract employees is set out in the Pension Membership Policy - Part-time, Temporary and Fixed Term Contract Employees (PDF, 393 KB).

Permanent employees

Pension plan participation is mandatory:

  • for full-time permanent employees whose regularly scheduled hours of work are not fewer than 30 hours per week, and
  • part-time permanent employees whose regularly scheduled hours of work are fewer than 30 hours per week and at least 14 hours per week or 728 hours per service year

Temporary employees

Pension plan participation is mandatory for temporary, full-time employees whose regularly scheduled hours of work are not fewer than 30 hours per week.

Read the Temporary Employment Directive

Wage employees

An individual commencing employment on wages is not eligible for participation in the pension plans.

Pension plan participation is mandatory for 2,850 hour wage employees who meet the requirements of the Public Service Employment Regulation or Collective Agreement.

Read the Wage Employees Directive

The application of 'employee' and entitlements for management, opted out and excluded employees are set out in the Public Service Employment Regulation (PDF, 1.1 MB). The application of 'employee' for bargaining unit members is set out in the Collective Agreement.

Contract employees

Employees hired on a Contract of Employment have pension eligibility determined in accordance with guidelines describing the contract terms and provisions established by the Public Service Commissioner. Pension eligibility will be reflected in their employment contracts.

Employment pursuant to a contract of employment that precludes participation in a public service pension plan cannot be credited as pensionable service in any of the Alberta Public Service Pension plans if the individual later transfers to a position where pension plan participation is required. However, the individual may be permitted to purchase the service under the applicable pension plan rules. This provision continues after the conclusion or termination of the contract.

Participation in PSPP or MEPP

Pension participation for employees of the Government of Alberta is in either PSPP or MEPP (and the SRP).

MEPP (and SRP) participation relates to employees in the following categories:

  1. Employees holding a position that is classified or designated as a management position.
  2. Certain employees who are grandfathered to participate in MEPP pursuant to section 10(1)(o) of the Management Employees Pension Plan (AR 367/93) regulation – in particular: employees who are or were a MEPP participant by virtue of holding a position in another eligible category at any time from September 1, 2019 to January 1, 2021 and who, during that period, are either:
    • reclassified to a position to which PSPP otherwise applies, or
    • on the initiative of the Government of Alberta, are appointed to another position in the Government to which PSPP otherwise applies (except if resulting from a disciplinary action or the Government’s common law duty to accommodate),
    and provided their employment is continuous through the reclassification or re-appointment, and the participation continues only for so long as their employment remains continuous in that reclassified position or position to which they were appointed.

For more information on eligibility for grandfathered participation in MEPP, see the MEPP Grandfathering Guidelines (PDF, 774 KB).

All other employees of the Government of Alberta who are to participate in a pension (pursuant to the other rules above) participate in PSPP.

Exclusions

Notwithstanding the above, pension plan participation is not permitted if an employee:

  • works less than 14 hours per week or 728 hours per service year, or
  • has reached December 30 of the year in which they reach age 71, or
  • is in receipt of a pension from the PSPP, MEPP or the Public Service Management (Closed Membership) Pension Plan, based on previous participation in any of those plans

Pensionable salary

Pensionable salary types (list is not exhaustive)

  1. Gross basic annual salary, including salary for entitlements, for example:
    • General Illness
    • Long Term Disability Income (LTDI)
    • Supplemental Employment Benefits
  2. Modifiers – acting incumbent pay and other modifiers
  3. Premiums – shift differential nights and shift differential weekends
  4. Retroactive salary adjustments

Non-pensionable salary types (list is not exhaustive)

  1. overtime
  2. standby pay
  3. vacation leave payout
  4. expense allowance payments (for example: meal allowances)
  5. non-cash benefits

Pensionable salary – calculation

Pensionable salary is calculated, and contributions to the pension plan are deducted, on a bi-weekly pay period basis.

Annualized salary

PSPP

  1. Where a full-time employee's annualized pensionable salary will exceed the Year's Maximum Pensionable Earnings (YMPE) limit established for the PSPP for the reporting year, the employee's pensionable salary and YMPE will be annualized and contributions will be prorated within each bi-weekly pay period for the purpose of determining contributions to the pension plan.
  2. The above information applies to part-time employees' salary although full-time equivalencies are not applied to part-time salary.

MEPP and SRP

  1. Where an employee's annualized pensionable salary will exceed the salary cap established for the MEPP, the employee's pensionable salary and the salary cap will be annualized and contributions prorated within each bi-weekly pay period for the purposes of determining contributions to both the MEPP and the SRP.

Pensionable salary – calculation parameters

In accordance with guidelines issued by the Alberta Pensions Services Corporation, the pension plan contribution rates, YMPE, and salary cap figures for a year relate to all pensionable salary paid within that pension plan reporting year. The period during which an employee receives LTDI benefits is considered pensionable service and contributions will be made on the pre-disability salary and eligible increases.

For information related to other salary types, please contact your Ministry Payroll Specialist.

Pensionable service

Pension Plan Reporting (Service) Year

The service year for pension purposes relates to the bi-weekly pay schedule.

Pensionable Service – Base Unit

Pensionable service will be calculated on a daily basis by determining the number of days worked within the pension plan reporting year, out of the total possible number of days within the pension plan reporting year.

The full-time equivalent base units used in the calculation of pensionable service are set out in accordance with the Public Service Employment Regulation or Collective Agreement and shall be either:

  1. 40 hours per week, or
  2. 38.75 hours per week, or
  3. 36.25 hours per week, or

the equivalent, on a bi-weekly, monthly or annual basis. The part-time equivalent base units are calculated as a percentage (%) of the full-time equivalent as outlined above.

Pensionable Service – Maximum Accrual

Pensionable service earned within a service year will not exceed 1.0000 under the pension plan.

Related information

For more information on any of the pension plans, contact the Compensation Services Centre.

About this directive