CRA applies the “predecessor employer” concept on a business segment basis

Reg. 8504(2.1) provides that employment with a “predecessor employer” is included in the computation of the maximum pension benefit. This term references inter alia a sale of all or a part of a business “if all or a significant number of employees of the vendor have, in conjunction with the sale…become employees of the employer acquiring the business.”

If a distinct segment of a particular company were sold off, CRA would consider it appropriate to look only at that particular segment, rather than the company as a whole, in determining whether or not a significant number of employees had become employees of the acquiring employer.

Neal Armstrong. Summary of 5 May 2017 OBA Seminar, Q.7 under Reg. 8500(1) – predecessor employer.