Third-party Service Contracts and Teaching
	February 1, 2008 Special Notice to Employers Individuals who perform teaching duties in a school board or designated private school are bound by provisions of the Teachers’ Pension Plan (the “Plan”). This applies to all teachers, regardless of whether they are hired directly as employees of the school, or indirectly through a third party with whom the school has negotiated service contracts (including self-employed independent contractors). We’d like to clarify the reporting requirements and pension implications of hiring teachers through third-party service contracts, as we have seen a significant increase of these arrangements involving school boards and retired teachers (covered briefly in the September 2007 issue of Pension Update (495 KB PDF), page 6). Reporting requirements School boards and designated private schools that contract out some of their teaching duties to a third party should be aware that these teachers are eligible for Plan membership. This means any qualified teacher working at a school board or designated private school as a teacher is covered by all provisions in the Plan (including, but not limited to, re-employment guidelines and mandatory service reporting). Teaching duties include, but are not limited to, work as a tutor, principal and counselor. You are required to report their service and remit contributions on their behalf, even if they are not on your employee payroll. Please advise anyone who is employed as a teacher in one of your schools of these requirements. Serious financial implications for teachers Pensioners working in these capacities at any location affiliated with your board or private school must comply with re-employment provisions and limits. For example, pensioners who work as principals or vice-principals, regardless of who employs them, must re-enroll in the Plan once they exceed the re-employment limits. We will suspend the pension of any pensioner who exceeds the re-employment limit and will recover any overpayments that may have occurred as a result of the pensioner’s failure to report any re-employment beyond the limits. Third-party service contracts may also impact a member’s eligibility to begin receiving a pension. As you know, a bona fide cessation of employment must occur for members to be eligible to begin receiving their pension. If there is a pre-existing arrangement to return to employment before the later of the member’s resignation date or the date we receive a member’s pension application, a bona fide cessation of employment cannot occur. Contact us If you engage qualified teachers through a third party, or teachers that are independent contractors, you will need to ensure accurate pension reporting occurs. If you have any questions, please contact us.

	Posted February 2008	TOP