Guide for January 2018new employees Introducing your … · Introducing your benefits 1 ... effective way. Our philosophy is ... If you have flex dollars remaining after selecting

Introducing your benefits

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Your benefits are a valuable part of your total rewards at BMO. You may be eligible for all or many of these benefits:

Health & security benefits: These include medical, dental, insurance and income protection benefits.

Wellness & work-life effectiveness programs: These include vacation, leaves of absence, LifeWorks and Best of BMO.

Retirement & savings programs: These include the Employee Share Ownership Plan, Employee Savings Program, BMO’s Pension Program and the health & insurance benefits that begin when you retire from BMO.

As a BMO employee, you will have access to a wide range of benefits to help you plan for and respond to different events in your life. Through our benefits program, BMO provides you and your family with access, choice, education and financial support to:

Our vision is to be the bank that defines great customer experience. Our focus is clear, and every dollar counts in achieving our commitment to our customers. Therefore, we ensure that our benefits plans provide value in the most cost-effective way.

Our philosophy is that benefits are a partnership: the cost is shared by both BMO and its employees. This helps to focus everyone’s attention on managing benefits costs and using benefits wisely. This gives us the flexibility to create opportunities for you to buy additional cost-effective coverage to meet the benefits needs of you and your family.

We are pleased to provide this overview of the benefits that will be available to you as an employee of BMO. When you are hired, you will have online access to more detailed benefits information through myHR on the HR Intranet and myBenefits & Retirement.

Your health & security benefits.............................................................................................. Page 2

Your wellness & work-life effectiveness benefits.................................................................... Page 7

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Stay healthy, Protect your income, Find balance in your life, and Save for the future.

Guide for new employees

January 2018

Introducing your benefits

Your health & security benefits

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Definitions

Full-time equivalent (FTE) This is the percentage of full-time hours that you work. An employee with FTE 100% works 37.5

hours per week; FTE 20% means 20% of full-time hours (i.e., 7.5 hours per week). If you work less than 50% of full-time hours, you may have less coverage or fewer choices than an employee who works full-time.

Spouse Your spouse is the person to whom you are legally married, or a person with whom you have lived

openly in a common-law relationship for at least 12 months. Eligible Child Eligible children include natural, adopted or step-children who are under age 21 (or under 25 and

attending school full-time). Adult children with disabilities who are dependent on you may also be eligible, at any age, if their disability existed while they would have met BMO’s definition of a child.

BMO lets you create a benefits package that meets the unique needs of you and your family.

Each year, you will receive flex dollars based on the cost of a standard package of dental, medical and life insurance benefits for you and your eligible dependants. You use these flex dollars to help pay for the cost of a customized package of benefits that you choose for you and your family. If the cost of your chosen package is more than your flex dollars, you pay the difference through payroll deductions.

If your needs change, you can adjust your benefits choices during annual enrolment, and whenever your family status changes (“a qualifying life event”), such as a marriage or the birth of a baby.

You are eligible to join BMO’s benefits program on your first day of employment if you are a regular employee with FTE 20% or higher*. The following pages outline the program. You will be notified via email of your benefits enrolment opportunity in myBenefits & Retirement.

* Unless indicated otherwise, the benefits outlined in this guide are not available to Temporary employees.

Introducing your benefits

Benefits highlights Your flex dollars

NOTE: Proof of good health is not required for BMO’s Medical Plan. Any option can be selected without restriction.

Medical Plan

Employees: FTE 50% to 100% Choice of 5 options, all include the Emergency Travel plan. Highlights from those options:

Option 1: Catastrophic emergency coverage only

Option 2: 50% of eligible expenses, including:

– Prescription drugs – private duty nurse (to $25,000 every 3 years) – semi-private hospital room – up to $400 per year combined for psychologists and social workers – up to $400 per year combined for paramedical practitioners,

including speech therapist and physiotherapist 80% vision (to $250 every 2 years)

Option 3*: 80% of eligible expenses, including:

– Prescription drugs – private duty nurse (to $25,000 every 3 years) – semi-private hospital room – up to $800 per year combined for psychologists and social workers – up to $800 per year combined for paramedical practitioners,

including speech therapist and physiotherapist 80% vision (to $300 every 2 years)

Option 4*: 90% of eligible expenses, including:

– Prescription drugs – private duty nurse (to $50,000 every 3 years) – semi-private or private hospital room – up to $1,500 per year combined for psychologists and social workers – up to $1,500 per year combined for paramedical practitioners,

including speech therapist and physiotherapist 80% vision (to $400 every 2 years)

Option 5: (designed for employees with access to another medical plan) 20% of eligible expenses, including:

– Prescription drugs – private duty nurse (to $25,000 every 3 years) – semi-private hospital room – up to $200 per year combined for psychologists and social workers – up to $200 per year combined for paramedical practitioners,

including speech therapist and physiotherapist

Cover the cost of the employee portion for Option 3, and half the cost for the dependant portion if family coverage selected.

* Québec residents: This plan covers all prescription drugs mandated by provincial legislation. Also, eligible children are covered to age 26.

Your health & security benefits (cont’d)

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Introducing your benefits

Benefits highlights Your flex dollars

Medical Plan

Employees: FTE 20% to 49.9% 50% of eligible expenses, including

– Prescription drugs – private duty nurse (to $25,000 every 3 years) – up to $400 per year combined for psychologists and social workers – up to $400 per year combined for paramedical practitioners,

including speech therapist and physiotherapist 80% of semi-private hospital room 40% vision (to $125 every 2 years) emergency travel plan

Cover the cost of the employee portion and half the cost for the dependant portion if family coverage selected.

BC MSP If you live in British Columbia, BMO pays 50% of your provincial Medical Services Plan premium.

No flex dollars are provided.

Dental Plan Employees: FTE 50% to 100%

• Option 1: no coverage

• Option 2: 50% basic/preventive, 0% major restorative up to $600 per year combined

• Option 3: 80% basic/preventive, 50% major restorative up to $1,500 per year combined

• Option 4: 90% basic/preventive, 60% major restorative up to $2,000 per year combined; 50% orthodontia up to $2,000 per lifetime

• Option 5: 20% basic/preventive; 50% major restorative (designed for employees with access to another dental plan)

Cover the cost of the employee portion for Option 3, and half the cost for the dependant portion if family coverage selected.

Employees: FTE 20% to 49.9%

• Option 1: no coverage

• Option 2: 50% basic/preventive, 30% major restorative up to $600 per year combined

Cover the cost of the employee portion of Option 2, and half the cost for the dependant portion if family coverage selected.

Survivor Benefits

Your survivors may continue access to BMO’s medical and dental benefits, LifeWorks and Best of BMO in the event of your death.

No flex dollars provided. If coverage is selected, paid by you through payroll deductions.

Health Spending Account

If you have flex dollars remaining after selecting your benefits, they are deposited to this account to spend on medical, dental or vision care expenses that are not covered by your options. Flex dollars are tax-free when deposited to this account. You may elect to have excess flex dollars paid to you as taxable cash.

Business Travel Accident Insurance

Provides accident coverage for you while you are on business anywhere in the world in addition to any personal accident coverage you may have purchased through the Employee, Spouse or Child accident insurance plans. This coverage is automatically applied from your first day of your employment, and no enrollment is required. Basic benefit: 3 x your Benefits Base Rate to a maximum $600,000.

Your health & security benefits (cont’d)

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Introducing your benefits

Benefits highlights Your flex dollars

Life Insurance

Employee: Coverage options from $10,000 to 10 times your Benefits Base Rate*. Proof of good health not required at initial enrolment.

Cover the cost of 1 x your Benefits Base Rate (BBR).

Spouse: Coverage options up to $250,000. Your spouse does not need to provide proof of good health if you enrol your spouse when you first join BMO.

No flex dollars provided. If coverage is selected, paid by you through payroll deductions.

Child: Coverage options up to $20,000.

Accident Insurance

Employee: Coverage options up to $1 million.

Spouse: Coverage options up to $600,000.

Child: Coverage options up to $200,000.

Short-Term Disability (STD) Plan

BMO provides a level of income replacement for up to 26 weeks, at no cost to you, if you are unable to work due to an illness or injury. For the first 12 weeks of approved disability, your benefit level will be 100% of your BBR**. After 12 weeks of approved disability, the benefit reduces from 100% to 75% of your BBR for the remainder of your approved leave. Eligible from your first day of work at no cost to you. Temporary employees may be eligible for a modified STD plan.

Not applicable.

Long-Term Disability (LTD) Plan

Participation is mandatory. At your first enrollment, you may elect any LTD option without providing proof of good health. Any subsequent change to a higher LTD option will require proof of good health. Choice of 5 options. Three include a cost-of-living (COLA*) feature to protect against inflation. Most of your disability income will be tax-free if you become disabled. The maximum LTD benefit is $20,000 per month.

Option 1: 50% of first $40,000 of Benefits Base Rate; 30% of the balance Option 2: Option 1 + COLA feature Option 3: 60% of first $40,000 of Benefits Base Rate; 40% of balance Option 4: Option 3 + COLA feature Option 5: 60% of the first $40,000 of (BBR + 2 year average STIP) + 40%

of (BBR + 2 year average STIP - $40,000) + COLA feature For most employees, Benefits Base Rate (BBR) is equal to your base pay. For employees in eligible sales roles, BBR reflects your base pay plus variable earnings (i.e., commissions). Bonus or incentive pay, overtime pay, lump sums, honorariums or other pay premiums are excluded. * COLA is applied at 100% of the consumer price index (CPI) to a maximum of 5% each year.

No flex dollars provided. Premiums are paid by you through payroll deductions.

• For most employees, Benefits Base Rate (BBR) is equal to your base pay. For employees in eligible sales roles, BBR reflects base pay plus variable earnings (i.e., commissions). Bonus or incentive pay, overtime pay, lump sums, honorariums or other pay premiums are excluded.

Your health & security benefits (cont’d)

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** Commission-based employees receive 100% of base pay for the first three weeks of approved absence, and then 100% of the Benefits Base Rate (BBR) for the next 4-12 weeks.

Introducing your benefits

Benefits highlights Your flex dollars

Emergency pre-enrolment coverage

In the rare event that you are unable to enrol in benefits by your enrolment deadline because you suffer an acute medical emergency or die, you and your eligible dependants will receive these benefits:

Dental/Medical: Option 3 for the number of eligible dependants on record for you Life insurance – Employee: Option 5 (4 x Benefits Base Rate) Life insurance – Spouse: Option 4 ($75,000) Life insurance – Children: Option 3 ($10,000 per dependant child) Accident insurance – Employee: Option 5 ($200,000) Accident insurance – Spouse: Option 4 ($150,000) Accident insurance – Children: Option 4 ($75,000 per dependant child) Long-term disability: Option 4 (60% of first $40,000; 40% of balance; COLA) Survivors’ benefits package: Coverage, if you have eligible dependants

Your health & security benefits (cont’d)

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Introducing your benefits

Your wellness & work-life effectiveness benefits

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In addition to the health and security benefits, BMO provides a wide variety of ways to help you manage your family and personal commitments, goals and financial plans.

Benefits highlights

Statutory Holidays

Employees are entitled to a minimum of 11 statutory holidays per year.

Vacation

Employees begin earning vacation on the first day of employment. The number of paid vacation days is determined by grade and accumulated years of service with BMO.

The chart above is for a full-time employee (37.5 hours/week).Vacation is prorated based on standard hours for part-time employees.

Example for a part-time employee: A grade 4 employee scheduled to work 25 hours per week is entitled to 75 hours of vacation per year, calculated as follows:

Vacation entitlement for the year of hire is prorated based on the employee’s start date.

All vacation must be taken between January 1st and December 31st each year. Vacation not taken is not paid out and can only be carried over with prior approval from management.

People Care Days

Paid time off for a few hours or a few days, at the discretion of your manager, to help you balance work and family commitments (e.g., to manage family issues, education-related activities, and participation in community or charity events)

* Note: If your FTE is less than 100%, vacation time and pay will be prorated to reflect your FTE.

Accumulated years of service with BMO

Vacation entitlement in hours *

Grades 1 to 6 Grades 7 and above

In days In hours In days In hours

1 or more years to less than 10 years 15 days 112.5 20 days 150

10 or more years to less than 20 years 20 days 150 20 days 150

20 or more years 25 days 187.5 25 days 187.5

Full-time annual entitlement hours X Standard

hours/week / 37.5 hours = Prorated annual

entitlement hours

112.50 x (25 / 37,5) = 75

Introducing your benefits

Benefits highlights

Maternity/Pregnancy Leave

Birth mothers are eligible for up to 17 weeks of Maternity/Pregnancy Leave and may qualify for Employment Insurance (EI) benefits

To recognize a period of post-partum recovery, top-up payments are provided for the first six weeks after delivery

Benefits can continue during this period

Note: Different provisions exist under the Quebec Parental Insurance Plan.

Parental Leave Birth mothers can elect between a Parental Leave of up to 35 weeks or up to 61 weeks.

Adoptive parents, mothers, and fathers can elect between a Parental Leave of up to 37 weeks or up to 63 weeks.

While on leave, employees may be eligible for EI benefits Benefits can continue during this period BMO has a six-week top-up payment program for all employees who are

eligible for EI benefits while on parental leave Note: Different provisions exist under the Quebec Parental Insurance Plan.

Compassionate Care Leave and Leave Related to Critical Illness

Eligible employees who require time away from work to provide care or support to someone close to them who is gravely ill are eligible for leave.

Extended Leaves of Absence

BMO provides unpaid, extended leaves when both you and BMO are fully committed to your return to the organization. These leaves are designed to maintain a long-term employment relationship while meeting your shorter-term needs.

Benefits may continue. Maximum duration is 104 weeks.

Tuition Reimbursement Program

100% reimbursement of tuition costs for undergraduate-level courses and specialized programs to a maximum of $5,000 per calendar year.

80% reimbursement of tuition costs for graduate-level courses and EMBA programs to a maximum of $8,000 per calendar year.

LifeWorks LifeWorks is a comprehensive resource centre that offers information and practical solutions to help you be productive on the job while caring for loved ones and meeting personal needs. It is available to you and your family, 24 hours a day, 7 days a week.

LifeWorks offers many services, including: – the Employee Assistance Program (EAP), which provides confidential,

short-term counselling and support to help you manage and resolve personal issues

– BMO’s Back-up Child Care program, which enables you to maintain your focus on the customer and other workplace priorities by offering short-term emergency child care if your regular child care arrangements break down.*

* Note: The use of this service is a taxable benefit.

Your wellness & work-life effectiveness benefits (cont’d)

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Introducing your benefits

Benefits highlights

Best of BMO Best of BMO provides employees with specialized service and offers on a wide range of products and services which includes: Employee banking BMO Mastercard Mortgages Lines of credit Loans Investment products BMO Insurance products

Your wellness & work-life effectiveness benefits (cont’d)

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Introducing your benefits

Benefits highlights

Employee Share Ownership Plan (ESOP)

The Employee Share Ownership Plan (ESOP) provides an opportunity for you to become an owner of BMO through the purchase of BMO common shares. As an owner, you can benefit from the value that you help to create, while saving for your retirement and long-term goals. There is no waiting period to join.

When you contribute a percentage of your Benefits Base Rate (BBR) – as little as 1% of your BBR* – you receive matching contributions from BMO.

BMO matches 50% of the first 6% of your contributions, up to a maximum of $3,000 per year.

Your contributions are made through bi-weekly payroll deductions and can be directed to a Registered Retirement Savings Plan (RRSP), a Tax-Free Savings Account (TFSA) or a non-registered, taxable Employee Profit Sharing Plan (EPSP).

BMO’s contributions are directed to a tax-sheltered account, unless you have them directed to the EPSP. BMO monitors its contributions and will automatically redirect them to the EPSP once the tax-sheltered limit is reached.

Withdrawal penalties may apply depending on how long you have participated in ESOP and when you make the withdrawal.

Employee Savings Program

You can accumulate savings for the future with both a Registered Retirement Savings Plan and a non-registered Savings Plan. Investment options are:

• BMO Mutual Funds

• Bank of Montreal Guaranteed Investment Certificates (GICs)

As a BMO employee, if you receive a Short-Term Incentive Award, you have the option to transfer all or a portion of it to Registered Retirement Savings Plan under this program.

BMO provides several ways to help you save for the future and prepare for retirement.

Retirement & savings programs

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* Maximum BBR of $100,000

Introducing your benefits

Benefits highlights

Basic Non-Contributory Pension

You become a member of the BMO Canada Pension Plan after 2 years of continuous employment from your most recent date of hire or re-hire. You are vested* once you become a member of the plan. Contributions to the basic pension provisions are paid by BMO. Your annual basic non-

contributory pension payable at your normal retirement date as follows: (Part-time employees who work less than 50% FTE will become members after completing 2 years of continuous employment and earning at least 35% of the YMPE*** in each of the two consecutive years.)

Optional Contributory Pension

You are eligible immediately upon becoming a member of the BMO Canada Pension Plan. You can increase your total pension by participating in the optional contributory pension.

If you enrol, you will contribute 4.5% of your pensionable salary (subject to regulatory limits), and earn an additional benefit as follows (based on normal retirement):

SelectBenefits At retirement, you are eligible for SelectBenefits, BMO’s retiree health and insurance benefits program, if you:

Are a vested member of the BMO Canada Pension Plan and are now eligible to receive pension immediately upon leaving BMO, and

Are living in Canada covered under a provincial healthcare plan; and,

Were not terminated for cause.

When can you retire? The normal retirement date is the day following your 65th birthday. On this date, you will be eligible to receive full pension and retirement benefits. You can choose to take early retirement. The earliest retirement date is determined based on your pension start date and years of service with BMO. If you retire early, your pension entitlement will be reduced by 0.33% per month, for each month you retire early. Further details will be reflected in your Annual Pension Statement. Note: Based on pension legislation you must commence drawing on your BMO pension by the end of the calendar year in which you turn 71. You will no longer be able to accrue a pension benefit under BMO’s Pension Plan. This does not mean that you cannot continue to work at BMO; at BMO there is no mandatory retirement.

* Vested means that you are entitled to receive any pension you have earned. ** C/QPP Offset = [1.25% x C/QPP Benefit x Years of Credited Service] *** YMPE = Year’s Maximum Pensionable Earnings

Retirement & savings programs (cont’d)

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x x – 1.25% Average

Pensionable Salary

Years of Credited Service

C/QPP Offset **

x x 0.75% Average

Pensionable Salary

Years of Optional

Contributions

Introducing your benefits

SelectEconomy SelectEnhanced

Medical Plan 0% until annual deductible is reached, then 100% for remainder of the year; $50,000 lifetime maximum

80% coverage for many services and supplies are not covered by your provincial health plan; $100,000 lifetime maximum

Dental Plan No coverage 80% of preventive and routine treatment, and 50% of major restorative costs; annual $1,200 maximum

Basic Life Insurance Flat benefit of $10,000 50% of final Benefits Base Rate for first five years; 25% thereafter for life (minimum benefit of $10,000)

Optional Life Insurance

Units of $25,000, up to a maximum coverage of $250,000. Coverage ends when you reach age 70.

Optional Family Life Insurance

Coverage purchased in units of $12,500-$75,000 for your spouse, and $7,500 for each eligible dependant child up to age 21. Coverage ends when you reach age 70. Pre-retirement coverage continues automatically without evidence of insurability.

Individual Accident Insurance

Optional coverage of up to $1 million until you reach age 70

Family Accident Insurance (Optional)

Spouse only: Coverage equal to 60% of retiree amount Spouse and children: Coverage equal to 50% of retiree amount for spouse and

15% for each child Children only: Coverage equal to 20% of retiree amount Coverage ends when you reach age 70

Best of BMO & LifeWorks

You continue to participate when you retire from BMO.

SelectBenefits: BMO’s Retiree Benefits Program There are two options to choose from, SelectEconomy or SelectEnhanced. For both options, eligible dependants must be enrolled in the same option as you.

This document does not confer any contractual rights or obligations. The actual benefit plan terms are governed by official contracts and plan documents. If any discrepancies between the contents of this document and the official documents should arise, the terms of the contracts and plan documents will apply in all cases. BMO Financial Group reserves the right to suspend, amend or terminate any or all benefits and change rates at any time.

Retirement & savings programs (cont’d)

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