What happens if there is a transfer deficiency?
When a transfer deficiency exists, an initial amount of your benefit will be transferred, based on the percentage of funding the plan has. The employer must contribute to the pension plan within five years the rest of the funds needed to provide the remainder of your benefit (or the transfer deficiency) and then must transfer the remainder of the benefit, plus interest to you.
For example:
The plan is 90 percent funded and your total benefit entitlement is:
$100,000
Initial benefit will be:
$100,000 x 90% = $90,000
Remaining benefit will be:
$100,000 - $90,000 = $10,000 plus interest