Final Average Earnings Cap

The pension formula in the CSI Plan uses Final Average Earnings or FAE.  This is the average of the best five years of your earnings (three years of service up to August 31, 2010) in your last 20 years of service up to a set date.  This date is updated each year if the financial status of the Plan allows it.  As noted in the June, 2011 Pension Update this year the Plan was not amended to update FAE - the earnings recognition date will remain at August 31, 2011. 

A clarification needed to be made for those participants with less than five years of eligibility on or after August, 31, 2011.  FAE will be capped at August 31, 2011 or after three years of service (for the three year portion of the benefit formula) or after five years of service (for the five year portion of the benefit formula), whichever is later.

Full Issue: No. 179 - October 5, 2011

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