McMaster’s pension plan to adjust deduction frequency

McMaster employees who participate in the University’s defined benefit pension plans will see a shift in the way their pension contributions are deducted from their pay beginning this October.

Annual pension deductions will be equally spread over each of the 26 pay periods (i.e. employees will have a pension deduction on each of their bi-weekly pay statements). This is a shift from the current system which has 24 deductions per year. The current approach (24 deductions per year) is a hold-over from the time when McMaster paid employees bi-monthly (24 times per year) rather than bi-weekly (26 times per year). The move to 26 contributions per year will occur as part of McMaster’s switch to a new human resources information system.

The annual amount of an employee’s deductions will not change as a result of this approach as illustrated in these examples.