Benefits and Employment Practices

We recently purchased a Benefits and Compensation Survey from the Toronto Board of Trade. After reviewing the contents, we were pleasantly surprised at the usefulness and relevance of the information contained within the survey. To date we have been able to use many of the findings to assist our clients in the design or redesign of their benefits program.

Too often, employers initiate benefit programs, without having a clear objective as to what they want to offer to their employees and why. Analyzing information from other industry leading organizations can assist a company in rationalizing the plans that they have for their own employees.

Some of the highlights of the survey are as follows:

  • 73% of respondents reported that they paid 100% of the cost of providing health care coverage to their salaried employees and 63% indicated that they paid the full cost for their hourly employees. For dental care, 70% of employers paid the full cost for salaried employees, while 61% paid the full cost for hourly workers.This is in stark contrast to the majority of employers that we have been in contact with, who typically do not make any distinctions between hourly and salaried employees, with respect to their employer premium contribution. Furthermore, these employers typically contribute only 50% to 75% of the costs of benefits.
  • The most common schedule of life insurance for salaried employees was 2 X Annual Earnings followed by 1 X Annual Earnings. The survey indicates that 33% of respondents indicated 2 X Earnings as the most common schedule offered to hourly employees.Once again, for the majority of plans we have come across, we typically see flat benefit amounts, such as $25,000 or $30,000 for hourly workers.
  • 53% of respondents offered dependent life benefits to salaried and hourly employees.
  • 83% of employers offered Long Term disability to their salaried employees, while only 39% provided this coverage to hourly employees.
  • Of particular note is that 57% of employers provide annual sick day plans to their employees.We would have thought that with recent corporate cutbacks, this percentage would have been much lower; with companies relying entirely on Employment Insurance. Evidently this was not the case.For salaried employees, 49.7% of respondents reported that they provide 100% reimbursement for prescription drug benefits, 11.3% offered 90% coverage, while 32.3% provide 80% reimbursement for prescription drugs.
  • On the same subject, 75.4% of respondents reported providing a pay direct drug card, while 24.3% did not.
  • With respect to dental benefits for salaried employees, it was interesting to note that 64.4% of respondents do not use deductibles for dental care benefits, while 22.3% of employers did. This is very surprising considering that deductibles do not keep pace with inflation because of dental erosion or leveraging.
  • 52.2% of salaried employees enjoy 100% reimbursement for basic dental services. 8.1% of employers provide 90% reimbursement and 37% provide 80% coverage.
    84% of employers offered Major Restorative treatments (crowns and bridges) for salaried employees and 15.7% of employers did not.

If nothing else, the numbers are interesting because they offer some insight into the structure of plans offered by some of Toronto’s most notable employers.

2018-04-17T15:56:32+00:00