Common use of REDUCTION METHOD Clause in Contracts

REDUCTION METHOD. Reduction method 15. (1) Subject to subsection (2), to the extent that a value or amount referred to in subsection (3) or (4) of section 13 relates to benefits arising from the application of a provision of a pension plan or of pension legislation that came into effect less than five years before the date of allocation, such value or amount shall, for the purposes of subsection (3) or (4) of section 13, be reduced: (a) by 100%, if the period from the date that the provision of the pension plan or pension legislation came into effect to the date of allocation is less than one year; (b) by 80%, if the period is one year or more, but less than two years; (c) by 60%, if the period is two years or more, but less than three years; (d) by 40%, if the period is three years or more, but less than four years; and (e) by 20%, if the period is four years or more, but less than five years.