January is here and with it comes the making and breaking of new year's resolutions, new starts, clean slates and ... changes to provincial and federal legislation.
Although I've written about changes to OHIP and the new Ontario drug coverage plan that provides free access to 4,400 prescription drugs for those 24 and under, I thought it might be an important time for a refresher. Related to this provincial change is the development of OHIP+, a mobile-friendly tool to help you find out what is covered at no cost for children and youth aged 24 and under.
This is such an exciting change and the first of its kind in Canada. Free for those with a Ontario health care or health card number are: diabetes test strips, oral contraceptives, medications to treat some childhood cancers, asthma inhalers, drugs to treat depression, anxiety, epilepsy, ADHD, antibiotics, EpiPens, and other conditions.
Ontario Drug Benefit (ODB) Eligibility requirements
If you are looking to provide an update or a reminder to employees or for your own purposes, remember that to be ODB eligible, you need:
- to be a child or youth, age 24 or younger,
- age 65 or older;
- living in a long-term care home or a home for special care;
- receiving professional home and community care services;
- enrolled in the Trillium Drug Program, Ontario Works or Ontario Disability Support Program. More info about eligible can be found here.
Have your Ontario health card or health card number handy.
More great news -- enrolment is automatic with no co-payment or annual deductible and eligible prescriptions will be filled at no charge at any Ontario pharmacy. Just be sure to show an Ontario health card or health card number.
Changes to parental and maternity leave in Canada.
Back in April 2017, I wrote about the pending changes to the parental and maternity leave in Canada. At that time, nothing had been cast in stone. With the updated rules recently communicated, parents have more choices. They can opt for either 12 months or 18 months of combined maternity and parental leave. This legislative change was effective Dec. 3, 2017 and applies to any expectant Canadian parent outside of Quebec -- which has its own parental and maternity benefits.
December 3 is a key date.
If you started receiving parental or maternity benefits before December 3, the government doesn't offer you the option to switch to the 18-month system. This means that you can't choose to claim extend parental benefits if your child was born or placed with you for the purpose of adoption before December 3, 2017.
The 18-month system has locked in job security for workers in federally regulated workplaces such as transport companies, public service, telecoms and banks. The Canada Labour Code has been updated for this change in legislation already.
Those in provincially regulated jobs (the majority of working Canadians) can choose the 18-month system as of December 3, but may not have the same peace of mind for job security as their federal counterparts quite yet as changes to individual labour codes related to job protection have yet to be amended.
Standard versus Extended Parental benefits - what is the difference?
Standard parental benefits can be paid for a maximum of 35 weeks and must be claimed within a 52 week or 12 month period after the week the child was born or placed for the purpose of adoption. The weekly benefit rate is 55% of the claimant's average weekly insurable earnings up to a maximum amount. The two parents can share 35 weeks of standard benefits.
Extended parental benefits can be paid for a maximum of 61 weeks and must be claimed within a 78-week period or 18 months after the week the child was born or placed for the purpose of adoption. The benefit rate is 33% of the claimant's average weekly insurable earnings up to a maximum amount. The two parents can share 61 weeks of extended parental benefits.
Other legislative updates
For some employers, January may be a busier time as changes to existing policies and collective agreements are updated and/or communicated.
Canada Pension Plan Contribution Rates, Maximums and Exemptions. Each year, the government communicates the information specific to payroll deductions, employer and employee contribution rates.
Specific to the Canada Pension Plan (CPP), the 2018 yearly maximum pensionable earnings is $55,900 and the employee and employer contribution rate is 4.95%
Information related to registered plans such as money purchase, defined benefit, RRSPs, deferred profit sharing plans, and tax-free savings accounts limits as well as the year's maximum pensionable earnings (YMPE) is available here.
Employment Insurance (EI) premium rates and maximums -- Federal EI premium rates and maximums for 2018 are: $51,700 is the maximum annual insurable earnings for 2018. The maximum annual employee premium is $858.22 and the maximum annual employer premium is $1,201.51 with a rate of 1.66%
Especially at this time of year, employers are faced with knowing about legislative changes affecting their workplace and sometimes keeping track of all the changes may seem like a bit of a moving target. A knowledgeable third party perspective can foster the confidence that you've applied changes correctly to your specific work arrangements.
We invite you to contact us.
With over 3 decades of industry experience, we have the skills, experience and resources to help you implement policy and plan changes to meet legislative requirements as well as your program needs. As always, we're here to help so that you can focus on what you do best.
There was a time not that long ago when diversity centered primarily around recognizing gender bias in the workplace including pay equity imbalances and a lack of female representation at senior leadership and board levels. While this issue hasn't been fully resolved and continues to garner attention, diversity and inclusivity (D&I) issues have expanded to include far more broad-reaching topics.
What does diversity and inclusivity cover?
Today diversity considers culture, nationality, gender, race, sexuality, education, socio-economic background and geographic background.
As the workforce faces more global pressures and competitive influences, the benefits of supporting diversity and inclusivity become more compelling. Employers who seek to support D&I understand that it also makes good business sense. Respecting different cultures, backgrounds and life experiences promotes open-minds, creative thinking, and new ideas that may lead to better business outcomes.
On June 19, 2017, the Canadian federal government amended the Canada Human Rights Act to expressly prohibit discrimination on the grounds of "gender identity and expression." This law applies to every Canadian province and territory except Yukon and Nunavut. Even in areas where it isn't the law, the courts reference it.
How can employers support D&I in practical ways?
1) Update or implement diversity policies.
Employer policies to review and update should include:
- dress code;
- gender diversity policy (outline transition guidelines for transgender employees)
- privacy and confidentiality;
- restroom use;
- hiring and recruitment procedures;
- harassment and anti-discrimination policies;
- employee orientation; and
- employee engagement survey questions.
2) Monitor the company culture and positively acknowledge employees that support diversity and inclusivity in the organization.
Supporting D&I requires both a top down and bottom up approach. It warrants ongoing communication efforts that don't simply pay lip service to supporting a diverse and inclusive workplace. Employees bring valuable insights from their cultural background as well as life experiences. These differences add value to an organization.
3) Educate and inform employees.
Education and information includes applying the platinum rule rather than the golden rule. Where the golden rule states that we should treat others how you want to be treated, the platinum rules states that we should treat others how they want to be treated. This means that we may inadvertently cause offence by not knowing personal or cultural boundaries. This could include how a handshake is perceived or how maintaining eye contact may be interpreted. Employees should be encouraged to ask if they are uncertain and apologize if an accidental offence occurs.
4) Provide a safe and confidential resource. Help employees understand how diversity impacts their role and what they can do to support the company's obligation and inclusive culture. Have a mechanism for employees who might have discomfort around some issues related to diversity -- an HR contact or EAP to speak with. Not everyone will embrace diversity in the same way and at the same time; however, compliance with employer's legal obligations must be adhered to as well as the policies that are in place to treat all employees equitably.
4) Benefits program plan design. Consider your company's benefits philosophy and what, if anything, needs to be changed.
Supporting D&I isn't about checking a box. It is about education, training and an appreciation for the equitable treatment of all. Tolerance takes time and policies should be revisited and updated as an organization continues its efforts to support diversity.
More resources on the topic as well as case studies continue to be make available. For example, the Ontario Human Rights Commission offers a Best Practices Checklist for employers to address practical ways to support gender diversity in the workplace. As this important topic continues to emerge and grow in significance, we invite you to contact us to discuss ways to ensure your benefits program meets your D&I criteria and legal obligations. We are well positioned to support you with our HR Global resources and decades of industry knowledge. As ever, we're here to help so that you can focus on what you do best.
There was a time not that long ago when parental leave in Canada was no more than 6 months in duration. Fast-forward from 2003 to March 2017 and we are looking at changes that allow parents to choose to receive employment insurance parental benefits over an extended period of up to 18 months.
Options for parents.
The good news for parents -- they have choices. With the proposed changes in the 2017 Federal budget, parents can elect to take no more than a period of 12 months in order to receive parental benefits at the existing rate of 55 per cent of average weekly earnings or extend the parental leave to 18 months at a rate of 33 per cent of the weekly average wage.
Longer window to secure childcare arrangements.
This extension of parental leave over a longer period of time was a federal election promise made repeatedly throughout the Liberal campaign. With expecting and new parents struggling to secure suitable childcare arrangements, it is promising position especially for parents finding it challenging to secure suitable childcare arrangements.
Keeping parents in the workforce.
The extension also provides a buffer for the parent who was on leave to return to workplace hopefully with less stress and with a greater sense of ease through the transition from primary caregiver to working parent. In the past, it wasn't uncommon for a parent to decide not to return to the workforce or attempt a return on a part-time basis and the extension will hopefully allow parents to embrace a full-time return to work instead.
What does this change means for employers?
1) To top up or not to top up? For larger employers where parental leave top up provisions were part of the employee benefits package, an important decision is necessary. Employers may decide to either top up in alignment with the new parental leave extension or to take no additional action. In reality, there are a number of combinations of a top up scenario that could implemented.
2) Policy Statement review? If employer top up provisions during the parental leave are going to be changed, wording in HR policies will need to follow suit. In addition, vacation accruals, which generally are allocated annually, will need to be reviewed for the parental leave extension.
3) Productivity and filling parental leave vacancies. There are different ways to consider the parental leave extension.
A) It might be easier to secure a top-talent contract replacement when the extended leave duration affords a longer contract position;
B) The extended leave might help ensure that the employee on leave feels ready mentally and physically to return to work on a full-time basis.
C) On the flip side, an extended absence may make it more challenging to reintegrate a worker after an 18-month leave. The employer may find it more work to keep the absent employee updated on changes in the workplace and to ensure they remain engaged and committed to returning.
D) Should the employee's position not be backfilled during the leave, employees might feel the pressure and strain of the work they might be responsible for covering during their colleague's extended absence. A consistent focus on employee engagement initiatives and keeping a pulse on productivity, goals and outcomes will be more important than ever.
If you're looking to make changes to your benefit program as a result of the Federal Budget announcement regarding the proposed extended parental leave or otherwise, we have the experience to recommend and navigate effective solutions to meet your needs. We invite you to contact us. We're here to help so that you can focus on what you do best.
If you read Canadian newspapers, you simply can't miss it. The media is aflutter with articles and social media posts about the question said to be under consideration for the upcoming federal budget, expected in early March 2017.
The Federal Government is considering taxing Canadians' employer-paid health and dental benefits.
The Finance Minister committed to a sweeping review of 150 tax credits worth about $100 billion in potential federal review. If health and dental benefits were treated as a taxable benefit, $2.9 billion in tax revenue could be collected.
---In today's news, TheStar.com reports that Prime Minister Trudeau "suggested the tax would not be part of the upcoming budget after he was quizzed on the issue by interim Conservative Leader Rona Ambrose."---
What employee benefits are taxed?
Currently employer paid life insurance and car allowances are considered taxable income. In Quebec, health and dental benefits have been taxable benefits since before 2000.
What's all the hubbub?
A change in this tax policy would effect more than half of the Canadian population.
When the change was introduced in Quebec, approximately 20 percent of employers dropped their group health and dental coverage. If this tax policy change occurs, it is predicted that employers, like those in Quebec, may drop or reduce group health and dental benefits coverage because the tax change would simply be too cost prohibitive.
Who will this affect?
It is reported that 13.5 million workers (22 million if their dependents are factored in) have private health and dental plans and they would be negatively effected by the elimination of this tax credit by an increase of between $500 and $1,200 in their annual tax bill.
Should this policy change be implemented, there is a high probability that the shift would revert from the private payor world to our public system where the costs are already hard to manage.
There is no official statement from the finance ministry to confirm or deny if this tax policy change is under consideration.
Who's up in arms?
Many Canadian healthcare professionals want Canadians to write their MPs to tell them they don't want this tax change. Chiropractors, dieticians, occupational therapists, dentists, physiotherapists and more are supporting a campaign called, "Don't Tax My Health Benefits" with the goal of raising public awareness of the potential for the elimination of this tax credit from the upcoming budget. To learn more about this campaign, check out the website www.donttaxmyhealthbenefits.ca
Have a say.
The "Don't Tax My Health Benefits" campaign encourages Canadians to have their say and sign a petition. If you don't support this potential change, you can write to your local member of parliament directly from the Don't Tax My Health Benefits website.
We're here to help.
We monitor the latest industry trends with a particular focus on the impact to employer-sponsored benefits and pension programs. No matter what position you hold on questions such as these, we're here to provide you with timely and relevant information. We invite you to contact us. We're here to help so that you can focus on what you do best.
Employment Insurance Program waiting period reduction: What can a one week change mean to employers?
The Liberal government has taken action to make sweeping changes to our Employment Insurance (EI) Program where the combined total cost is estimated at $1.45 billion for 2017.
While several of the EI program changes have already taken effect, one that is more complex won't kick in until January 1, 2017. The Budget Implementation Act 2016, No. 1, received Royal Assent on June 22, 2016 and reduces the EI disability coverage from two weeks to one week.
What is the EI waiting period?
The EI waiting period is a period of time that must be served before a claimant can begin to receive EI benefits and it has been set at two weeks since 1971.
What is the EI payment period?
The EI payment period is 17 weeks and includes a 2-week waiting period where no benefit is paid. A total of 15 weeks of paid benefits is factored into the 17 weeks.
What changes happen to the EI Program on January 1, 2017?
The January 1, 2017 changes mean that the payment period will include only a 1 week waiting period where no benefit is paid followed by a 15 week period of paid benefits. This change results in only a one week period of no paid benefits.
Of note, the number of weeks of benefit is not changing and there are no plans to change the timeframes that employers need to issue records of employment.
What could a one week difference represent for employers and service providers as well as Canadians in need of this benefit?
According to The Honourable MaryAnn Mihychuk, Minister of Employment, Workforce Development and Labour, reducing the two-week waiting time is "a systemic change. It impacts skills programs. It impacts other associated support. That's very complicated." This complex change is good news for claimants who will be without income for a shorter period of time if they apply for EI, but the change require additional work on behalf of employers and service providers who need to consider the impact to employee communications, handbooks, existing disability plans and collective agreements. It could mean that insurers will ask for an LTD premium adjustment for employers opting to shorten the LTD elimination period from 119 to 112 days . Employers face the question of whether or not they wish to absorb a potential cost increase.
What if you have a registered plan with the EI Premium Reduction Program?
If you have a plan registered with the Employment Insurance Premium Reduction Program you will need to reduce the waiting period for Weekly Indemnity (WI ) and/or Short-Term Disability (STD) benefits from 2 weeks to 1 week in order to ensure the preservation of EI premium reductions. This change may represent a cost increase and will depend on the benefit plan design and use.
What about insured STD or self-insured salary continuance plans?
If you have a plan with a waiting period of 7 or fewer days there is no impact to you and no action that needs to be taken.
If you have a plan with a waiting period of more than 7 days, please contact us to discuss the implications.
What about requirements for Supplementary Unemployment Benefit (SUB) Plans?
SUB plans -- also known as EI top-up plans -- are tied to EI claims linked to layoffs, EI sickness benefits, maternity and parental leave and compassionate care. For existing SUB plans, this change may reduce costs as employees will be able to access EI benefits earlier during their leave period. It depends on the duration of the SUB plan benefit payments and utilization. If you have specific questions about your SUB plan, please contact us.
What does this mean for employer-sponsored Long Term Disability (LTD) Benefits?
Many employers structure their LTD program with benefits beginning only after a claimant uses up EI sickness benefits or after the 17 week elimination period or 119 days. This means that sickness benefits will run out at 16 weeks or 112 days. If you offer LTD benefits that starts after the 17 week of EI, consider if an amendment to the plan is warranted given that employees will have 1 week where no benefit is paid.
As 2016 draws to a close, employers will need to consider if the change impacts their current benefit program. Good news for employees comes from Service Canada who advises that the Canadian Life and Health Insurance Association (CLHIA) will give impacted employers a transition period to make the necessary amendments to their plans AND they will continue to qualify for the EI Premium Reduction Program during the transition period.
We are keeping a close watch for any EI Program updates so we remain well positioned to offer timely support regarding the implications to employer-sponsored salary continuance and disability benefit plans. We want to ensure your program runs smoothly and we invite you to contact us if you have any questions. We're here to help so that you can focus on what you do best.
Back in the eighteenth century, Benjamin Franklin coined the term "There are no gains without pains." Over the years, this term has been better known as "no pain, no gain,"
With our industry a buzz in discussions about pension reform and what will be best for our nation, this phrase of Ben Franklin's comes frequently to mind.
Experts question whether CPP enhancements will soften the job market for an already weak Canadian economy. They wonder if the CPP expansion is more of a tax hike likely costing families more instead of facilitating an accelerated ability to save.
Will jobs be eliminated because of rising premiums? The increase to 5.95% from each of employers and employees over a 5 year period beginning on January 1, 2019 may seem like more of a calculated gamble. It is one that the Federal government believes is worth taking especially when it is estimated that 1.1 million Canadian families are reportedly not saving enough for retirement.
The goal is to eventually provide future retirees with one third of their average incomes (up from one quarter) through the CPP, This reform also provides a tax deduction instead of a tax credit on the increased contributions, which will reduce government revenues.
Small business owners share mixed feelings on the subject and worry that CPP premium increases will damage our struggling economy and force them to eliminate jobs.
The Finance Department's projections indicate that CPP reform will create an economic lift to help future generations of retirees. It is a longer term strategic approach that may, in the short term, create a softening in the job market. The plan appears akin to Ben's belief -- there are no gains without pains. The looming question may well be, "Are Canadians ready to accept short term pains with the belief that CPP reform will generate longer term gains?"
Regardless of what side of the CPP reform fence you may be on, it is a topic that concerns Canadians particularly as the Baby Boomer generation continues its rapid trek toward retirement. As per Statistics Canada, we have more people over the age of 65 than under 15 and this greying generation makes up 27% of the population -- double what it was in 1971.
It isn't a simple situation, but it is one that our team is well positioned to address. We have the experience and expertise to discuss ways to help you manage risk and develop sustainable cost management strategies. We invite you to contact us. We're here to help so that 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.
There are new obligations for Ontario employers coming this September which are sure to keep many Human Resources professionals busy in the coming weeks creating or updating their company's anti-sexual harassment policy.
Why? As of March 8, 2016, Bill 132 received Royal Assent at the legislative Assembly of Ontario making it clear that sexual harassment is a workplace safety issue. As there have been an increasing number of high profile sexual harassment cases in the media in the last 12 months, it is no wonder that the Ontario Government has pushed their sexual violence and harassment action plan through the political engine at such an expedited pace. One of the biggest changes is that the Act amends the Occupational Health and Safety Act (OHSA) and requires employers to take action at the beginning of September.
* Bill 132 expands on Bill 168 (introduced in 2010 -- obligating employers to create workplace violence and harassment polices and programs to protect workers.) Bill 132 protects workers from sexual harassment in that the definition has been broadened to include "workplace sexual harassment".
The definition reads:
"engaging in a course of vexatious comment or conduct against a worker in the workplace because of sex, sexual orientation, gender identity or gender expression, where the course of comment or conduct is known or ought reasonably to be known to be unwelcome; or
making a sexual solicitation or advance where the person making the solicitation or advance is in a position to confer, grant or deny a benefit or advancement to the worker and the person knows or ought reasonably to know that the solicitation or advance is unwelcome."
Here's the quick run down of what employers with 5 or more employers need to ensure is in place by September 8, 2016:
* Someone in the organization needs to receive training on investigating workplace harassment complaints;
* All supervisors need to be trained on workplace harassment so they can identify "incidents and complaints" of workplace harassment or the Ministry of Labour may be in a position to order an investigation by an outside investigator at the company's expense;
* the organization needs to prepare a policy specifically addressing investigations and related procedures to comply with Bill 132 or they need to amend their current policy to do so. Of particular note, the investigator's mandate must be clear and determined upfront given the results of the investigation must be disclosed to the person who has been allegedly harassed.
* Employers will now be obligated to develop a written program to respond to issues of harassment and sexual harassment in the workplace. If they already have a program and policy in place, they need to review it at least annually. The program must include the following:
1) measurers for reporting incidents of workplace harassment to a person other than the employer/supervisor if the employer/supervisor is the alleged harasser;
2) detail how incidents or complaints of workplace harassment will be investigated and handled;
3) detail how information about an incident or complaint of workplace harassment won't be disclosed;
4) detail how the alleged victim and harasser (if a worker) will be informed of the investigation results and any corrective action arising from the investigation;
Of note, the Ontario Ministry of Labour's inspectors will now have the power to order an employer to use a third party to investigate a workplace harassment incident and to issue a written report at the employer's expense.
Our team will continue to monitor Bill 132 in light of any further guidelines. For more information, please contact us. We're here to help so that 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.