2023 Consolidated Financial Statements and Notes
AIR CANADA
2023 Consolidated Financial Statements and Notes
9. PENSIONS AND OTHER BENEFIT LIABILITIES
The Corporation maintains several defined benefit and defined contribution pension plans, as well as other post-
retirement and post-employment benefit plans.
The Corporation is the administrator and sponsoring employer of eight domestic registered plans ("Domestic Registered
Plans") with defined benefit commitments registered under the Pension Benefits Standard Act, 1985 (Canada). The
defined benefit components of the Domestic Registered Plans are closed to new members, except for the hybrid
component of three plans which are open to new members. The Corporation also has a U.S. plan, a UK plan and a
Japan plan, which are international defined benefit plans covering members in those countries. In addition, the
Corporation maintains a number of supplementary pension plans which are not registered. The defined benefit pension
plans provide benefits upon retirement, termination or death based on the member's years of service and final average
earnings for a specified period. Benefit payments are from trustee-administered funds, however there are also a number
of unfunded plans where the Corporation meets the benefit payment obligation as it falls due. Plan assets held in trusts
are governed by regulations. The governance of the plans, overseeing all aspects of the plans including investment
decisions and contributions, lies primarily with the Corporation. The Human Resources, Compensation and Pension
Committee, a committee of the Board of Directors, assists in the monitoring and oversight of the plans to ensure pension
liabilities are appropriately funded, pension assets are prudently invested, risk is managed at an acceptable level and
retirement benefits are administered in a proper and effective manner.
Other employee benefits include health, life and disability. These benefits consist of both post-employment and post-
retirement benefits. The post-employment benefits relate to disability benefits available to eligible active employees,
while the post-retirement benefits are comprised of health care and life insurance benefits available to eligible retired
employees.
Pension Plan Cash Funding Obligations
As at January 1, 2023, the aggregate solvency surplus in the Domestic Registered Plans was $4.6 billion. The next
required valuation to be made as at January 1, 2024 will be completed in the first half of 2024. With the Corporation's
Domestic Registered Plans in a solvency surplus position as at January 1, 2023, past service contributions were not
required in 2023. In addition, in accordance with legislation and applicable plan rules, the excess over 105% on a
solvency basis can be used to reduce current service contributions under the defined benefit component or to fund the
employer contribution to a defined contribution component within the same pension plan. Based on that, and including
the international and supplemental plans, the total employer pension funding contributions during 2023 amounted to
$61 million ($86 million employer contribution net of $25 million of surplus used to fund employer contribution in defined
contribution components of the same plans). Pension funding obligations for 2024 are expected to be $101 million.
Benefit Obligations and Plan Assets
These consolidated financial statements include all the assets and liabilities of all Corporation-sponsored plans. The
amounts recorded in the statement of financial position are as follows:
Pension Benefits
Other Employee Future
Benefits
Total
(Canadian dollars in millions)
2023
2022
2023
2022
2023
2022
Non-current assets
Pension assets
$
2,588 $
2,444 $
$
2,588 $
2,444
Current liabilities
Accounts payable and accrued
liabilities
65
62
65
62
29
Non-current liabilities
Pension and other benefit liabilities
842
825
1,033
945
1,875
1,770
Net benefit obligations (assets)
$ (1,746) $
(1,619) $
1,098 $
1,007 $
(648) $
(612)
The current portion of the net benefit obligation represents an estimate of other employee future benefits claims to be
paid during 2024.
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