Common use of Pension Calculation Clause in Contracts

Pension Calculation. The following is an example of how the pension of an employee in a Reduced Hours of Work arrangement would be calculated. Assume an employee has the following years of employment: 20 years full-time, followed by 5 years of 50% part-time, and then 10 years full-time. For pension eligibility purposes the employee has 35 years' service, i.e. 20 + 5 + 10 to calculate the amount of pension to be received the part-time years are pro-rated. 20 + 5/2 + 10 = 32.5 years pensionable service 30 + 5/2 x 2% = 65% pension. If the reduced hours years were the last five years, i.e. 30 years full-time + 5 last years at 50% part-time, the part-time earnings would be annualized as follows, assuming the part-time earnings are $25,000 or 50% of the yearly rate of $50,000 for the last three years of employment. The calculation is as follows: (30 + 5/2) x 2% = 65% pension annualized pension is $50,000 x 65% = $32,500/year.

Pension Calculation. The following is an example of how the pension of an employee in a Reduced Hours of Work arrangement would be calculated. Assume an employee has the following years of employment: 20 years full-time, followed by 5 years of 50% part-time, and then 10 years full-time. For pension eligibility purposes the employee has 35 years' service, i.e. 20 + 5 + 10 to calculate the amount of pension to be received the part-time years are pro-rated. 20 + 5/2 + 10 = 32.5 years pensionable service 30 + 5/2 x 2% = 65% pension. If the reduced hours years were the last five years, i.e. 30 years full-time + 5 last years at 50% part-time, the part-time earnings would be annualized as follows, assuming the part-part- time earnings are $25,000 or 50% of the yearly rate of $50,000 for the last three years of employment. The calculation is as follows: (30 + 5/2) x 2% = 65% pension annualized pension is $50,000 x 65% = $32,500/year.