A paycheque deduction marked “OMERS” is buying something quite different from a balance in a personal retirement account. The money helps fund a pension whose eventual value depends on a formula, so the amount you contribute is not the amount you simply withdraw at retirement.
- Who Is Covered by OMERS?
- How the OMERS Pension Works
- How Much Do You and Your Employer Contribute to OMERS?
- When Can You Start Receiving an OMERS Pension?
- What Else Does OMERS Provide Besides the Lifetime Pension?
- What Happens to OMERS If You Leave Your Employer?
- What to Keep Track of While You Are an OMERS Member
- Other Questions About How OMERS Works
OMERS, the Ontario Municipal Employees Retirement System, is a jointly sponsored defined benefit pension plan serving eligible Ontario municipal and related public-sector employees. Members and employers contribute equal amounts, and OMERS invests the fund. At retirement, eligible members receive monthly pension income based primarily on their credited service and best five consecutive years of contributory earnings.
Who Is Covered by OMERS?
OMERS has more than 1,000 participating employers and 665,000 active, deferred and retired members as of June 30, 2026. Its membership includes employees of municipalities, school boards, local boards, transit systems, electrical utilities, emergency services and children’s aid societies across Ontario. OMERS membership and participating employers
Participation extends beyond municipalities themselves. Eligible traditional employers include local boards, conservation authorities and district social service administration boards. Certain organizations providing municipal services or programs can also participate as associated employers. OMERS employer and employee eligibility rules
OMERS is therefore a workplace pension rather than a pension that any Ontario resident can independently open. It is also separate from the Canada Pension Plan (CPP). The two can eventually form different parts of the same retirement income, which is covered more specifically in how OMERS and CPP work together.
How the OMERS Pension Works
OMERS is a defined benefit pension plan. Instead of giving each member an investment balance that determines retirement income, the plan promises a lifetime pension calculated under a set formula. OMERS defined benefit plan features
Two inputs are central to that formula: credited service and best-five earnings. Credited service generally represents the time you worked for an OMERS employer and contributed to the plan, including qualifying service purchased or transferred into OMERS. Best-five earnings are the average of your highest 60 consecutive months of contributory earnings. Overtime and most lump-sum payments are excluded. OMERS pension calculation rules
The calculation also uses the Average Year’s Maximum Pensionable Earnings (AYMPE). Rather than crowding an OMERS overview with the full formula, the components and calculations are broken down in how an OMERS pension is calculated.
Your own contributions are therefore not a running measure of how large your pension will be. Two members who contributed different amounts can have retirement benefits that reflect their respective earnings and credited service under the formula.
How Much Do You and Your Employer Contribute to OMERS?
OMERS deducts contributions from contributory earnings each pay period, and the employer contributes an equal amount. Investment earnings from the OMERS Fund finance the remaining portion of plan benefits. OMERS contributions and plan funding
For 2026, members with a normal retirement age (NRA) of 65 contribute 9.0% on contributory earnings up to the $74,600 YMPE and 14.6% above it. NRA 60 members contribute 9.2% up to the 2026 YMPE and 15.8% above it. These rates are scheduled to change on January 1, 2027.
Not every amount appearing on a paycheque counts as contributory earnings. Regular salary or wages, for example, are included, whereas overtime and most one-time or lump-sum payments are excluded. The detailed payroll treatment belongs in the separate explanation of OMERS contribution rates.
When Can You Start Receiving an OMERS Pension?
Most OMERS members have a normal retirement age of 65. An OMERS employer can provide an NRA of 60 to eligible police officers, firefighters or paramedics. NRA 60 is not automatically provided to every employee in those occupations.
You can potentially begin an OMERS pension up to 10 years before your normal retirement age once you have stopped working for your OMERS employer. That means age 55 for an NRA 65 member or age 50 for an NRA 60 member. Starting at the earliest permitted age does not automatically mean the pension will be unreduced. Age, service and the benefit rules applicable to your membership determine whether an early-retirement reduction applies. OMERS retirement planning rules
A pension that starts before 65 may also include a temporary OMERS bridge benefit. The bridge is separate from the lifetime pension and is designed to end at age 65. It should not be mistaken for CPP itself because the two benefits use different calculations.
Once retirement payments begin, the lifetime portion continues for as long as you live. The dates those payments arrive are tracked separately in the OMERS pension payment dates.
What Else Does OMERS Provide Besides the Lifetime Pension?
The plan includes benefits that become relevant at different points in a member’s career. These include survivor and disability benefits, options to purchase eligible past service and inflation protection for qualifying pensions. OMERS pension features
Buying eligible past service can increase credited service, which is why an OMERS buyback can affect the eventual pension calculation. Inflation adjustments operate under a separate set of rules, including different treatment for benefits earned before and after January 1, 2023. Those provisions are covered in OMERS pension increases and indexing rather than duplicating them here.
OMERS also provides benefits to qualifying survivors when a member dies. The entitlement depends on circumstances such as whether death occurs before or after retirement and who qualifies under the plan. The specific rules belong in the dedicated explanation of the OMERS pension death benefit.
What Happens to OMERS If You Leave Your Employer?
Leaving an OMERS employer does not mean the pension you earned disappears. Your available choices depend partly on whether you have reached the point where you are eligible to retire.
Members who leave before they are within 10 years of their NRA can have time-sensitive pension options. OMERS provides a Pension Options Form after the employer reports the termination. Members already within 10 years of their NRA are eligible to retire and receive options appropriate to that status. OMERS options after leaving an employer
One possibility can be keeping the earned benefit in the plan for later payment as an OMERS deferred pension. Depending on the member’s circumstances, other choices may be available, so leaving employment should not be treated as an automatic instruction to move the pension elsewhere.
What to Keep Track of While You Are an OMERS Member
The most useful number during your career is not simply the total deducted from your pay. Your credited service, contributory earnings and expected retirement date provide a much clearer picture of what the pension is building toward.
A myOMERS account lets members review pension information, update contact and beneficiary details, and estimate retirement income. myOMERS pension account features Checking those records periodically is worthwhile, particularly after changing employers, buying service or approaching retirement.
Other Questions About How OMERS Works
Can a part-time employee join OMERS?
Eligible non-full-time employees can participate in OMERS. For pension calculations, contributory earnings are annualized and credited service reflects the proportion of full-time hours worked.
Does being in OMERS affect your RRSP contribution room?
Pension benefits accrued through OMERS produce a pension adjustment (PA). The PA is reported on your tax slip and reduces the RRSP contribution room generated for the following year.
Can service from another pension plan count toward OMERS?
Certain pension service can be transferred into OMERS when the applicable requirements are met. Transferred service can become part of the credited service used in calculating the pension.
Is an OMERS pension taxable?
OMERS retirement pension payments are taxable income. The tax treatment and deductions from pension payments are covered separately in whether an OMERS pension is taxable.
