Two men at a table discussing business.

3 Tips to Improve Acceptance of Employee Benefits Changes

Modifying Employee Benefits & Minimizing Resistance

Making employee benefits changes and package modifications are sometimes not easily understood by staff. In some cases, making changes to employee benefits do not receive the widespread acceptance that an employer might hope for.

There are numerous ways employers can explain employee benefits changes. The objective is to provide a better understanding of necessary modifications to employee benefits while minimizing resistance that could derail the entire procedure.

In this post, our employee benefits brokers offer 3 Tips on how to better communicate employee benefits changes.

Tip 1: Lead by Example When Implementing Employee Benefits Changes

Informal and formal leaders, as well as those who have the ability to influence decision-making processes, need to support the employee benefits changes completely.

Any attempt to present adapted or modified versions of employee benefits without sincerity and honesty on behalf of people in these leading positions may appear hollow. Contemplate having the CEO explain proposed changes in a clear and sincere message to employees.

Tip 2: Involve Employees in the Benefits Changes Process

Employees who are involved from the outset in the process of implementing employee benefits changes are more likely to be receptive to proposed revisions.

Surveys or focus groups are excellent ways to explore the preferences and needs of employees. Avoid asking questions that you may not want to hear the answers to. Also avoid bringing up any other elements that are not on the table for amendment.

Tip 3: Clearly Communicate Potential Benefits Changes

While you can’t reveal everything to all your employees, be candid about what is evolved and why the employee benefits changes are necessary.

  • Identify stakeholders and important messages
  • Develop a timeline
  • And provide employees with adequate feedback channels

If uncertain about how to develop an acceptable communication mechanism, ask your employees for their input.

Employees don’t always interpret employee benefits changes as being necessary or beneficial. The onus is on employers to provide a clear explanation of modifications and how the adaptations will affect employees. You will also need to communicate whether or not employees will be provided with opportunities to contribute and respond.

About Benefits Strategies

For over 30 years Benefits Strategies have been providing creative, customized benefits programs for executives and employees. Our plans not only increase employee morale and satisfaction, they also elevate your business profile.

If you have any questions or need assistance with communicating employee benefit changes, please call our Edmonton office at 1-780-437-5070 or send us an email.

You can read more about the Canadian Human Rights Pension and Insurance Regulations on the Government of Canada’s Justice Laws website.

Waitress serving young patrons food in a restaurant.

Restaurant Finds Unique Way to Fund Employee Benefits Plan

A Toronto restaurant found a unique approach to employee benefits funding.

The restaurant began adding a 3% surcharge to each bill, with the funds to be used only to help provide employees with health and dental benefits.

Co-owner Heather Mee, was quoted in a May 2017 Benefits Canada article as saying, the surcharge was a “…more honest and transparent way” of funding the employee benefits.

In fact, there will be a separate item on each bill that is easily tracked and accountable so that it cannot be entered into the restaurant owner’s pockets.

The sole purpose for the bill surcharge is to provide a means of self funding employee benefits costs.

According to Mee, the average restaurant diner will spend less than $15 on a meal. This means that the surcharge for the benefits plan for each meal amounts to less than $0.50. As well, Mee states that diners who wish not to contribute will be allowed to opt out of the surcharge.

Aside from helping to cover health and dental, the employee benefits plan also covers services such as orthotics, massage therapy, and life insurance.

Mee acknowledges that the proceeds raised from the restaurant bill surcharge won’t cover all the expenses so the restaurant will pick up the balance.

In a market where few restaurants even offer benefits (because industry margins are minuscule and raising meal prices can be risky for the business), Mee admits that for her restaurant, this employee benefits funding alternative was a no brainer. Happy employees stay longer. And, many long-time restaurant customers are happy to contribute if it means helping the employees.

Need a benefits plan for your restaurant? Benefit Strategies can help.

Call us today at 780-437-5070 or send us an email.

Two generations talking about estate planning.

How to Talk About Estate Planning

Is Estate Planning the Elephant in the Room for Canadian Families?

Recent studies show that most Canadians are uncomfortable with talking about estate planning, finances and wills with their parents, families, and even professionals:

  • 47% of Canadians have never brought up the subject of inheritance with the people they want to leave money to
  • 79% have not consulted a financial advisor about the tax implications of wealth left behind

Source: BNN.ca

What You Need to Know When Talking About Estate Planning

The importance of wills and estate planning cannot be understated and there are several essential reasons why Canadians need to get over their awkwardness talking about estate planning with their families and with a professional Estate Planner.

For instance, do you know how to:

  • Allocate different types of assets to different people, depending on their relation to you?
  • Use Tax Free Savings Accounts as a tax shelter?
  • Appropriately use Trusts to avoid awkwardness and distrust among siblings?
  • Use Charitable Giving to enjoy tax benefits?

Once a professional estate planner has helped you with your estate planning and you are comfortable with your finalized will, it is equally as important to discuss these matters with family members and anyone else included in your will.

Talking about estate planning openly gives you an opportunity to explain to your heirs the reasons for why your will is set up the way it is, which can help prevent family legal disputes after your passing. You can also help your heirs understand the value of your inheritance in hopes they will be fiscally responsible with the inheritance they receive.

Estate Planning Tips

Here are a few simple tips on how talking about estate planning with your loved ones and heirs can help:

  • Talk often about smaller, less important matters so that everyone will become more comfortable with the topic.
  • Choose the right setting for your personal family dynamics, whether it is an impromptu casual setting or a formal discussion facilitated by your estate planner.
  • Communicate the contents of your will and estate plan in a group setting, with everyone present, stating your reasoning behind the way you have set up your will.
  • Use your own judgement in discerning how much information you should disclose to your heirs, depending on their maturity level and stage of life.
  • If you have a spouse, make sure you are on the same page, and you are both involved in the conversation.
  • Anticipate questions you think your children or heirs may have, and be prepared with well thought out answers.
  • Dream big and discuss your intended legacy with your heirs. While you can’t dictate what your children or heirs will do with the inheritance you have left them after you pass, you can work to instill common goals when it comes to spending, saving, and giving, in order to pass on a legacy through generations to come.
  • Be sure to ask the heir(s) how they feel and to air any concerns they may have. Give them a chance to be heard, even if you do not intend to change your will.
  • Make it clear that your will may be an ongoing discussion because a lot can change, especially if you are still young and healthy.

Still Have Questions About Wills and Estate Planning?

If you still feel you have unanswered questions about will preparation and estate planning and you need assistance please call our Edmonton office at 1-780-437-5070 to speak with one of our Executive Benefit Strategies advisors or use our online contact form to request a free Consultation.

Computer showing Insurance Policy graphic

Canada Critical Illness Insurance – FAQ

The purpose of this critical illness insurance FAQ blog post by Benefit Strategies, is to offer answers to some very basic questions that most Canadians have on this subject.

A critical illness insurance policy helps pay costs associated with a life-altering illness and is received as a lump sum cash payment. Essentially, a critical illness insurance policy helps you recover from a serious illness, condition, or disease, while maintaining your family’s lifestyle and financially stability.

For more information outside of this critical illness insurance FAQ, please contact our Edmonton Benefits Brokers directly at 1-780-437-5070.

Frequently Asked Questions

What is a critical illness?

Each critical illness insurance policy is unique but common critical illnesses may include:

  • Heart Attack
  • Stroke
  • Life threatening cancer
  • Major organ transplant
  • Total deafness or blindness
  • Loss of speech
  • Severe burns
  • Parkinson’s Disease
  • Alzheimer’s Disease

Why do I need critical illness insurance?

A critical illness insurance policy will ensure that you have the financial resources should you get sick and are unable to earn an income for any period of time.

Here are just four ways a Canada critical illness insurance policy could help you:

  1. Pay for financial obligations – Including you mortgage, car payments, credit card debt, and so on.
  2. Keep your independence – Make any modifications to your home or vehicle, or hire a caretaker to help.
  3. Pay for medical services – Help offset costs for medication or treatments not covered by your Provincial Healthcare provider.
  4. Relieve the pressure – Gives you the freedom to spend your time however you think may be most conducive for recovering, including spending time with family.

Is critical illness insurance worth it?

The answer to this question is personal. Everyone places a different value on their peace of mind, knowing they are financially secure in the event of becoming sick or incapacitated. Other people may prefer to forego insurance premiums and would rather save up a rainy day fund to cover critical illness expenses, should they occur. When deciding how you feel about critical illness insurance keep in mind that most Canadians have a reasonable probability that they will develop a critical illness by the time they are 65.

What affects critical illness insurance cost?

There are a number of considerations that can affect the cost of critical illness insurance rates:

  • Pre-existing conditions
  • Age
  • Gender
  • Amount of coverage
  • Smoking and drinking status
  • Health history
  • Current health
  • Occupation
  • Family History

Can I get combined life and critical illness insurance?

Many Canadian insurance companies offer disability insurance and critical illness insurance together. These bundled or combined disability and critical illness insurance policies can often help you save money over time.

What’s the difference between disability and critical illness insurance?

There are three main differences between disability and critical illness insurance:

  • Critical illness insurance pays out as a lump sum and typically sooner than disability insurance.
  • Critical illness does not require proof of income while disability insurance does.
  • Critical illness insurance policies are typically less expensive than disability insurance.

Disability insurance protects your income against the risk of a disability that would prevent you from working. Disability insurance will only pay out a portion of your income, until you are able to return to work.

Critical illness insurance however, pays the benefit after a diagnosis of a serious life-altering illness, regardless of whether you have a current income or not, or if you are able to work or not.

Is critical illness insurance taxable?

A critical illness insurance benefit payout is usually not taxable and comes in the form of lump sum payment, for you to spend in whatever way you wish.

Furthermore, any employer-paid critical insurance premiums are not a taxable benefit to the employee.

Do You Still Have Questions?

At Benefit Strategies Inc., critical illness insurance is just one aspect of our executive benefit solutions to help balance the benefit requirements of owners and managers.

If you have more questions that this critical illness insurance FAQ couldn’t answer, please call 1-780-437-5070 to speak with one of our executive benefit advisors today, or contact us online for a free Consultation.

Young woman with laptop at a table smiling.

Tips on Transitioning From Fixed to Custom Benefit Plans

The overall trend in the last several years for employee benefits is to move away from traditional or fixed benefits to more tailored, custom benefit plans.

One example is Health Spending Accounts that allow employees to choose the benefits they want. And, since employers only have to pay for the benefits that have been used, employers can save.

There are several reasons why Canadian companies are moving to custom benefit plans instead of traditional plans:

  • Cost Savings – Employers are able to control costs by setting benefit limits each year.
  • More Desirable – Employees are empowered to choose how to spend their employee benefits allowance, which helps them feel like they are getting better coverage.
  • Flexibility – Custom benefit plans are suitable for diverse workforces as employees can choose which benefits they actually need and want.

In this article, our Edmonton employee benefits brokers will offer four important employee benefits tips to consider if you are thinking of switching from a traditional benefits plan to more tailored, custom benefit plans.

1. Consider a Health Spending Account

Health spending accounts are great for employers because they can set the health spending amount. Employees in turn are able to choose where to spend their money. Be sure to read our article What Can a Flexible Benefits Plan Offer Your Employees?

Many companies transitioning between traditional and custom benefit plans ask this question, “What happens in the case of serious, costly medical issues or emergencies?”

Employees can often anticipate their needs for eyeglasses or prescription medications for the year, but what happens if there is an unexpected medical expense that exceeds their health spending account?

One solution is to keep a basic traditional plan and have a health spending account as an “add-on” for employees. Many employers are choosing to pair the custom benefit plans with a catastrophic covered or pooled plan. This ensures that employees are covered for more eventualities.

2. Check Out Administrative-Services Only (ASO) Plans

If your main reason for switching to custom benefit plans is cost savings, you may want to consider an ASO Plan.

ASO Plans are funded by the employer and administered by a third party. The employer only pays for what is used because the plan costs are based on actual (not anticipated) claims. If fewer claims are made than anticipated, the employer gets to keep the surplus.

The only downside to this option is that the employer will be left owing if there are any claims above the premiums paid for the year. Basically, the insurance company will predict anticipated claims for your workplace and if you exceed that amount you will be responsible to pay the deficit.

If you plan to offer employee benefit plans year over year, this option often ends up being slightly more cost effective.

3. Clearly Communicate the Potential Changes with Employees

Change in the workplace is often met with resistance regardless of how big or small the change is.

Be sure to work with your insurance broker to put your benefit plans into action to help make the transition very smooth. Employees may be worried the new custom benefit plans do not offer the same coverage or value. Be sure to outline the advantages of the change and confirm that each employee understands what they are getting under the new plans.

4. Find a Balance Between Employee Satisfaction and Bottom Line

There is always a fine balance of cost savings for the employer while still offering sufficient benefits plans to make sure your employees are well taken care. You should also consider making your traditional benefits plan or your tailored benefits plan a part of a competitive compensation package.

Can you attract and retain a qualified workforce with your current benefits plan?

About Benefit Strategies

For over four decades Benefit Strategies Inc. has been working with corporations and business owners throughout Alberta and Canada’s Western provinces to create cost effective employee benefits plans that reflect current market conditions.

Want to learn more about the differences between traditional and tailored health spending accounts? If you wish to discuss how to transition over to custom benefit plans, please call our office in Edmonton, Alberta at 1-780-437-5070 or send us an email.

Computer showing Insurance Policy graphic

What Do You Know About Long Term Disability Insurance?

One of the most frequently asked questions in regards to disability insurance in Canada is, “Do I really need to buy long term disability insurance?”

There’s no way to know if or when an injury or health issue will occur that might prevent you from being able to work for an extended period of time. In a matter of seconds, a serious accident could happen or a dire medical emergency or diagnosis might be made.

Your potential for earning future income could change and drastically change your way of life, and have very serious consequences for you and your family’s income and standard of living.

Here are seven questions you can ask yourself when determining if you should buy long term disability insurance or not.

These seven questions cover most of what you will need to know about a long term disability, about disability insurance coverage, and how it will affect you and your family.

  1. Can I afford the consequences of not having long term disability? (Who is depending on my income?)

In the case of an accident, disability insurance can help you focus on rehabilitation and getting better rather than worrying about how you will pay for ongoing daily expenses, such as your mortgage, car payments, child’s tuition, groceries, and so on. How would you continue to make ends meet? How would you maintain your standard of living? You may have other income earners in your family or you may have alternate savings plans in place that would help keep you monthly finances afloat while you are unable to work. But what if you don’t? What are your options?

  1. Does my employer offer long term disability insurance coverage?

If you work for a large company or have an employee benefits package through your employer, you may have a small Canadian disability insurance policy. Talk with Human Resources or your Policy Holder for the specific details on your insurance coverage and decide if you are comfortable or not with its level of coverage. Do you need to look at additional coverage options?

  1. Does my employee benefits plan offer enough disability coverage?

Even if you know you have disability insurance through your work’s employee benefits policy be sure to double check the details. Many disability insurance benefits cover between 54 and 70% of your gross taxable income. These plans often cap the monthly payout (ex. $2,500). Depending on your salary, this may or may not be enough to cover your monthly expenses. This is why private disability insurance plans are very attractive to large income earners.

  1. How will my age affect disability insurance coverage?

A younger person has significantly more years of earning potential and income to support disability insurance than a person nearing retirement. That is, the cumulative risk of suffering a disability lasting more than 90 days before retiring is much greater for a younger person than an old person.

For example, a 40 year old has an 18% cumulative risk of suffering a disability in their next 25 years of work before retiring at 65. Compare this to just an 8% cumulative risk of a 60 year old who has just 5 years left of work before retiring.

  1. What is my family medical history?

If you have a family history of medical conditions that you anticipate could be in your future that could prevent you from working, you may want to purchase disability insurance. Keep in mind that medical history plays a large role in qualifying and determining the cost of disability insurance in Canada.

  1. Does my profession have occupational factors that would make it difficult to return to work with a disability?

Some professions require significant physical requirements. For example, it would be very difficult to continue as a fire fighter with soft tissue damage or a knee injury. On the other hand, a professional with a desk job (or workload that could be adjusted given an injury) would likely be able to return to work much earlier on following an injury. They may even be able to fulfill their job description in spite of an injury that does not heal.

  1. What is my risk tolerance?

For a risk adverse personality, having the peace of mind in knowing that your family is secure in the case of a potential injury is worth much more than the disability insurance rates and premiums. Purchasing disability insurance may just help you sleep better at night.

Do you have more questions you need answered about disability insurance in Canada?

Contact a disability insurance advisor online at Benefit Strategies in Edmonton, Alberta or call our office at 1-780-437-5070 if you would like more information about disability insurance policies in Canada or to get a group disability insurance quote.