Pensions. For many, they’re as exciting as last year’s news, but James Pierlot knows better, and he’s quick to demonstrate their importance to anyone who will listen. “In Canada’s economic ocean, pensions are like icebergs: the biggest part is under the surface,” he says. “Because so much money is at play—about $2 trillion invested in private plans alone—pensions have a major impact on the economy as a source of investment capital, retiree income, and tax revenue.” With more than a decade and a half of experience in the sector, Pierlot is now out on his own as the principal of Pierlot Pension Law in Toronto. He’s constantly looking for ways to improve larger pension models, and he has emerged as a champion of national reform.
Pierlot’s career in pensions began in the Registered Plans Division of the Canada Revenue Agency (CRA), where he was tasked with reviewing pension documents to ensure their compliance with federal tax rules. After six years, he started law school and then moved to the private sector in 2000, serving as counsel with Bell Canada Enterprises and as a policy advisor with Magna International Inc. until 2003, when he joined Watson Wyatt Worldwide.
Through the Years
Pierlot acquires an LLB in common law, an LLB in French civil law, and an LLM in taxation law.
Publishes peer-reviewed paper promoting tax-policy reform to reduce federal government debt
Publishes peer-reviewed paper demonstrating inequalities between public- and private-sector retirement saving
Print and electronic media coverage of first paper launches him as a thought leader on retirement-saving policy
Establishes Pierlot Pension Law as a sole practitioner
Wins the John Hanson Memorial Prize and the Queen Elizabeth II Diamond Jubilee Medal for his papers and reform advocacy
Publishes peer-reviewed paper proposing reforms to pooled registered pension plans, new pension-saving vehicles introduced by the federal government
Serves as vice chair of the Ontario Bar Association’s Pension & Benefits Executive Committee
After joining Towers Perrin HR Services in 2005, Pierlot’s duties shifted toward direct client work, balanced by a leadership role in developing intellectual capital for the firm and promoting reform by preparing submissions to federal and provincial governments. “I became increasingly interested in the problem of unequal access to pension-saving opportunities and the predicament of Canada’s private-sector workers,” he says. “The current reality is that career public-sector workers look forward to receiving pension incomes three to four times more than private-sector workers.” Pierlot now sees the Canadian retirement-saving system—largely unchanged in almost 100 years—as structured to perpetuate this imbalance.
“Some reform advocates want to fix the inequality by reducing public-sector pensions,” Pierlot says. “But that would be a race to the bottom. A better approach is to make it possible for everyone to join the kinds of pension plans that have operated so effectively in the public sector. Everyone needs a secure, predictable income when they can no longer work.”
In 2008, Pierlot released his first major paper, A Pension in Every Pot: Better Pensions for More Canadians. It showed the large difference in retirement-saving outcomes between defined-benefit pension plans and other tax-deferred retirement plans and called for major reforms. Then, when his past employers merged in 2010 to form Towers Watson & Co., “it seemed like a good time to launch an independent firm,” he says.
In 2011, he set up his current practice, where he has continued to promote pension reform. “As an independent firm,” Pierlot says, “my focus is to provide responsive and personalized client service while continuing to promote well-reasoned, evidence-based reforms to Canada’s retirement system.”
The basis for Pierlot’s second paper, Legal for Life: Why Canadians Need a Lifetime Retirement Saving Limit, was a unique financial model that incorporated rules governing retirement saving from 1974 to 2012. The model showed that federal public-sector workers were retiring with pensions worth as much as $2 million. To provide equal pension-saving room for everyone, the paper proposed that $2 million be established as a universal cap on retirement savings for all workers and that all other contribution and benefit limits be eliminated. The paper won the John Hanson Memorial Prize from the Actuarial Foundation, in Chicago, in 2012.
As his business grows, Pierlot continues his quest. In late 2012, he published Pooled Registered Pension Plans: Pension Savior, or a New Tax on the Poor?, which proposed changes to a new federal government retirement-saving vehicle to make it work more effectively for low- and middle-income workers.
Although he enjoys being a sole practitioner, Pierlot is looking forward to controlled growth so that he can once again work with a team. “I like to collaborate on projects, as I was able to do with talented individuals at large firms,” he says. “With the right mix of expertise, you can come up with some great ideas and serve your clients very effectively.”