Even prior to the recent CPP enhancement announcement, the emphasis on saving and financial management has been a topic of conversation in the Canadian benefits arena for several months now. It is generally understood that aside from what Canadians may have picked up as students in a high school or college course, there are limited opportunities for adults to formally receive financial education training. This absence of education creates a notable gap in financial literacy levels. As a result, workplaces are filling up with workers who are stressed about their finances and who struggle to concentrate.
While there has been debate about what, if any, role employers should take regarding financial education, the reality remains that financial knowledge is lacking. As a result, employers find themselves in a position where they are called upon to close the gap and support their workers.
Employers who offer financial education in the workplace offers employees an environment where they can develop greater financial literacy and build confidence in areas that might be a source of great anxiety. Educated employees who've learned financial basics are better able to manage their financial future by taking control of their money matters today.
Financial basics look to address knowledge gathering in areas such as:
Perhaps the entire financial education conversation should include more focus on goal setting and understanding one’s financial value system. Providing employees with a list of questions to walk through either alone or with their partner might uncover some otherwise unsurfaced areas of concern when it comes to debt, savings and living with one’s means. Example of debt-management questions include:
Another way to facilitate financial education involves the use of online gamification where employees visualize themselves in retirement thereby allowing them to more realistically see their future selves. This allows them to practically consider the financial choices they make today.
Now with all of the available resources, can there be too much of a good thing? What if financial education turns to financial advice? Employers look for ways to ensure they don’t create scenarios that cross the line from education to advice.
Financial education can be separated from financial advice by taking a look at their respective definitions. Financial education is described as providing resources to help employees learn general financial terms and best practices. This type of information doesn't constitute advice. Widely available online, financial education is frequently offered through links to website resources. There are many reputable sources for free information on the home or landing pages of major Canadian banks. Financial education is also commonly offered via in-person workshops and worksite lunch ’n learns. These sessions are frequently supplemented by accompanying print material that offers general terms and unbiased resources.
Financial advice, on the other hand, involves providing a recommendation about a specific financial scenario. As employees start to internalize their own financial situations, there may be a tendency for questions to surface where specific recommendations are sought. This is where it pays to engage the services of an independent, certified financial planner who is qualified to work with employees on an individual basis. The point must be made to separate general financial education services from those that fall in the realm of advice giving. It must be made clear that the services of a financial planner or investment specialist are completely separate from that of the employer.
Once employers have established their parameters for offering financial education, there are many ways to creativity support employees’ ability to plan for financial success. We offer expert guidance in the realm of financial education and have a strong sense for what resources support greater workplace satisfaction. Don't let employee distractions and anxiety about their personal finances hinder productivity while increasing stress-related absenteeism in your workplace. Please contact us today. We’re here to help so you can focus on what you do best.
At one time, defined benefit pension plans were the norm. This might have been considered the post World War II golden age when workers stayed with one employer their entire career, had retirement farewell gatherings, were given a company watch and were reassured that their retirement annuity cheque would arrive monthly for the rest of their lives as a reward for their long years of service and dedication. According to Stats Canada, back in 1971, almost 50% of company pension plans for male workers were defined benefit arrangements. Fast forward to 2011 and that percentage drops to 25. Aside from the public sector, the shift away from defined benefit pension plans has been strong and steady. Many existing plans have also introduced grandfathering for retiree benefits.
It seems that the topic of pension reform has been much talked for almost a decade now. It is also well recognized that a widening gap exists for what public sector pension arrangements are able to offer Canadians workers during their golden years.
Several previous attempts at CPP reform failed. Now, with 8 of 10 provinces on board — excluding Manitoba’s Tory government who is still too new, and Quebec, with its separate approach through QPP — we appear to be moving ahead at full steam.
Something needed to be done given household debt in Canada leads the industrialized world. Perhaps we’ve been lulled into a false sense of predictable low interest rates allowing us to carry even higher amounts of debt.
In Ontario, the ORPP was set to launch in 2019 and if nothing else, it created more motivation for the feds to try again and seek the support of at least 7 of the 10 provinces representing at least 2/3 of the country’s population. In Ontario, we are ready to put ORPP plans on the shelf as CPP expansion was always the preferred approach to foster Canadians’ ability to save for retirement.
While not able to address those close to retirement or those who didn’t contribute much or anything and are now retired or quickly facing retirement, CPP reform will more fully support the savings needs of younger workers as well as those earners in the middle category who are earning in the range of $50,000 to $80,000.
Workers under age 45 and at these middle income levels appear to be most at risk. There are a number of possible contributing factors that result in an incapacity to save due to stronger competing forces vying for a limited pool of funds. Whether it is lingering student debt, mortgage payments, credit card bills or simply keeping up with The Joneses, the reality remains that many middle class workers aren’t saving enough for retirement and without the help of CPP reform, they might not easily find a way to change their behaviour in order to create favourable savings outcomes.
Major CPP reform changes at-a-glance:
Employers play a key role in the savings scenario too as many seek to educate employees and raise their level of financial literacy. We’ve been working with group pension plans and employers for over 2 decades now and invite you to contact us. We’re here to help so that you can focus on what you do best.
The 2016 Sanofi Canada Healthcare survey featured the responses and preferences of plan members across Canada. While prescription drugs remain top of the list in terms of usage and cost, paramedical services landed securely in second place. What has been surprising is the trend toward younger generations' looking to holistic alternative therapies and increasingly tapping into the use of paramedical services such as massage therapy.
Paramedical services are defined as "services provided by professionals who aren't covered by the public health system." Paramedical practitioners include: chiropractic, massage therapy, naturopathy, acupuncture and osteopathy.
For years now, cost control tactics for group insurance have rested squarely in the corner of prescription drugs. With costs containment strategies aimed at slowing the rapidity of drug spend, there hasn't been as much emphasis placed on what some may consider more low hanging fruit options for addressing unnecessary and expensive group plan extended health coverage.
The factors applying more pressure on this topic are affected by the behaviours of four primary stakeholders: the insurer, the plan sponsor, the plan member and the paramedical practitioner.
Insurers naturally look to support their clients in addressing areas where the biggest ticket spend categories punch their way forward as heavy weight champs. It requires experienced and highly specialized talent to navigate predictions for consumer spend, trends in the pharmaceutical industry and client tolerance thresholds. If plan sponsors don't raise the flag that there are other areas to focus on -- with as much diligence-- the emphasis may well remain fixed on pharma.
Plan sponsors benefit from creating or revisiting their benefits philosophy to avoid difficult decisions and conversations pertaining to what benefits are covered and why. In situations where companies feel the need to tighten their belts and are looking for any possible way to reduce costs, group benefits plan design may become an employee engagement danger zone if not handled strategically. One way to consider keeping the flexibility of paramedical services such as massage therapy involves Health Care Spending Accounts (HCSA). By including a cap on the amount allocated per plan member, budgets can be managed more consistently and with greater predictably.
Plan members value their benefits, but don't always connect the dots between usage and cost. Some hold the belief that since they have the paramedical benefit, they are entitled to using it whether or not there is an actual medical need. Helping plan members understand that increased usage drives the cost of providing the benefit is another actionable that both the insurer and the plan sponsor shouldn't lose sight of. Member education must always remain in vogue for employee benefits and incorporating trending communication methods, such as digital media, allows for creative ways to more accessibly reach this audience.
Paramedical practitioners have variations in their required training hours, code of ethics and accreditation associations. Their behaviours drive perception of professional standards and fraud in health benefits. Ensuring the need to operate with the highest ethical standards and requiring continued professional development and training hours will be invaluable in a constantly changed and increasingly complex working environment such as the spa industry where a predominance of paramedical practitioners such as massage therapists work.
While there are no quick fixes or simple solutions to the complexity of controlling costs, the need to remain focused on usage outside of prescription drug spend is real. If you're looking to more fully address these issues, I invite you to contact us. We have decades of experience and deep industry knowledge. Let us put that knowledge to work for you so that you can continue to focus on what you do best.
There was a time when top health issues in Canada were more physical in nature and relatively easy to identify. They ranged from musculoskeletal disorders to high blood pressure. In the last few years, more discrete and difficult to easily identify illnesses such as depression, anxiety and stress disorders top our country’s health issue charts.
When Morneau Shepell conducted their second annual national mental health survey in the fall of 2015, they received responses from over 1000 employees, 100 employers and 100 physicians. The report revealed that mental health issues and extreme stress — both workplace and personal — negatively impact an employee’s work.
The facts pertaining to mental health in the workplace continue to demonstrate staggering financial implications. In 2013, the Mental Health Commission of Canada reported that of the total economic burden caused by mental illness in Canada, $20 billion of the $51 billion per year relates directly to workplace losses due to disability claims, absenteeism and lost productivity. This data also highlights that 500,000 Canadians are unable to work in any given week due to mental health issues with 20% wrestling with mental health issues in any given year. The Morneau Shepell report highlights that mental health absenteeism is significantly underreported. This means that 500,000 Canadians unable to work in any given week due to mental health issues might actually be significantly higher.
Knowing the facts is important. It generates the need for further conversations about what is actually happening in the workplace and the importance of understanding organizational culture. Culture isn’t something you can see on the surface, it is felt and experienced by the employees who work in an organization. Similarly, workplace stress might not appear like a broken arm or someone recovering from surgery. It can be more difficult to identify. The Morneau Shepell report highlights that 60% of respondents said emotional/interpersonal issues were a source of workplace stress; these issues correspond directly to workplace culture. In the past, leaders were trained to bring greater attention to ensuring workers have a safe environment to work and the right equipment to do their jobs effectively. While these needs remain important, they ranked only at 14% as a cause of workplace stress in the Morneau Shepell report.
Emotional/interpersonal workplace stresses may also be triggered by the behaviour of the person’s direct supervisor, their colleagues as well as feelings of isolation. Perhaps surprisingly, these stressors proved to be far more prominent than any stress generated by deadlines or a dislike for one’s job.
As workplace stress and mental health issues continue to rise, action can be taken to stem the tide. The 2015 Morneau Shepell report demonstrates that employees would benefit from managers knowing what to do when an employee shows signs of distress.
Leader training on mental health can address the fear employees have about bringing their issues forward. Many report fearing the existing stigma associated with mental health. Removing the unhealthy barriers preventing services from being accessed and much needed help provided can be achieved through this type of specific management training.
Equipping front-line supervisors can be achieved through the implementation of an in-house program or through working with external vendors who provide the framework and/or the training itself.
The key components to a leader’s mental health training program include:
Training and educating leaders is an action organizations can take when looking to reduce absenteeism, turnover, disability duration and frequency. Doing so helps to create healthy conduits for employees while enabling them to connect with much needed stress management and mental health resources.
If you are looking to positively impact your disability management outcomes as well as increase productivity through employee engagement, please contact us — we have the resources and expertise to support your goals.
We’re here to help so you can focus on what you do best.
Dave Dickinson, B.Comm, CFP, CLU, CHFC
Experienced Benefits Specialist ready to optimize your group benefits and pension plans.