Since our last edition of Current Trends in February our country has been dealing with the COVID-19 pandemic and this edition is focussed on the impact this has had on group benefit and group savings plans as well as its impact on legislative issues.

Group Benefits

Relief for Plan Sponsors

Once the announcement was made by the Federal government on March 13th, it was no longer possible to access certain benefits that required being physically present and these include Dental, many of the Paramedical services and most Vision services. Our firm, and likely other advisory firms as well, lobbied with insurers on behalf of our clients to remove the premiums associated with those services until such time as the ban on these operations were lifted by the respective provincial governments.

The majority of the group benefit insurance market did respond however each has a slightly different approach and following are some samples in the order in which they were communicated:

1. Sun Life on April 16 for all insured plans offered a 50% credit on Dental premiums and a 20% credit on the non-drug-related Health premiums for the month of April and these credits would appear on the June billing statement then they state they “will be reviewing these credits on a monthly basis going forward”
2. Canada Life on April 17 for all insured plans offered a premium reduction of 50% on Dental, 20% on Vision and 20% on Health if the client has a Pay-Direct Drug Card and the credits will apply to April and May and will appear on the June billing statement and they will “fully evaluate emerging experience over the coming weeks”
3. Manulife later on April 17 offered a 50% reduction of the Dental premium and 10% of Health (including Drugs) in the month of May and the credit will appear on the June billing statement with a commitment to “taking it one month at a time”
4. Green Shield Canada still later on April 17 offered a 75% reduction to Dental and 20% to Health (including Vision but excluding Drugs) for the months of April, May and June with a commitment “to monitor the COVID-19 situation to determine a position for July”
5. Desjardins on April 20 offered a 70% credit on the Dental premium for April and May and will “continue to monitor the situation and make further adjustments in the coming months, as needed”

During this pandemic, many organizations have had to make lay-offs, both paid and unpaid, but have decided to maintain benefits during this timeframe. Each of over twenty insurance carriers that our firm works with on behalf of clients has their own set of rules pertaining to what benefits can be maintained and for how long so please do contact us if you have any questions as it is our experience during this unique time that tailored solutions are available at the insurer for each client if they are well supported with the appropriate materials.

Group Savings

Administrative Relief for Plan Sponsors

In response to this outbreak, the following regulators have provided administrative relief measures for pension plans. These extension deadlines are automatic.

A plan administrator may also apply for additional extension deadlines depending on their geographical jurisdiction so please do contact us for additional information on those options as well.

There are also regular updates from the Canadian Association of Pension Supervisory Authorities (CAPSA) on initiatives to help pension plan sponsors, plan administrators and pension regulators adapt to the realities resulting from this current situation. These include various levels of relief to plan sponsors as well as methods of protecting plan member benefits. For current information on these measures and announcements please contact the appropriate regulatory authority for your plan at https://www.capsa-acor.org/CAPSAMembers

Employer Contributions to DC Pensions Waived

The Canada Revenue Agency is waiving the one per cent (1%) minimum required contribution on defined contribution pension plans for the remainder of 2020.

The Minister of National Revenue is waiving this rule for the remainder of 2020 if the plan is amended to suspend accruals for the year, meaning there will be no employer or employee contributions made to the plan following the plan amendment.

This measure will only apply for the remainder of 2020 for plans that submit an amendment to the registered plans directorate.

Legislative

Cross-Country Review of New Leaves of Absence

In response to the COVID-19 crisis, the governments of a number of jurisdictions in Canada have amended their employment standards legislation to entitle employees to emergency unpaid job-protected leave when they are unable to work for reasons related to this current pandemic and its impact on businesses. This is an evolving situation as we start to come out of this crisis and new programs are evolving but here is a summary of the measures taken by governments in a number of jurisdictions.

Federal

Bill C-13, the Federal Government’s COVID-19 Emergency Response Act, received Royal Assent on March 25, 2020. As well as amending the Canada Labour Code, it created a 16 week leave of absence if the employee is unable or unavailable to work for reasons related to COVID-19.

Additional features of the leave include:

• Employers are entitled to receive a written declaration in support of the leave and of any change to length
• Employers may not dismiss, suspend, lay off, demote or discipline employees because they take the leave however they may assign them to a different position upon their return to work if they are unable to perform their prior job
• Employees’ pension, seniority and group benefits will continue while they are absent on leave and provided the employee continue to pay their share of required contributions

Newfoundland

On March 26, 2020, the Government of Newfoundland passed the Covid-19 Pandemic Response Act (Bill 33) which added a new Communicable Disease Emergency Leave and it was deemed to take effect on March 14th.

This Act entitles an employee to an unpaid leave starting on March 14th and for as long as COVID-19 is designated by the regulation for the Communicable Disease Emergency Leave.

Ontario

On March 19, 2020, the Ontario Legislature passed Bill 186, the Employment Standards Amendment Act (Infectious Disease Emergencies) 2020.

The measures are retroactive to January 25th and employees can remain on leave until the day the emergency has ended. During the emergency leave, employers must continue to make contributions to plans for pension, life insurance, health and dental.

Saskatchewan

On March 17, 2020, the Government of Saskatchewan passed Bill 207, the Saskatchewan Employment (Public Health Emergencies) Amendment Act 2020, which is deemed to be effective March 6, 2020. Employees can be on leave during which this order is in place and this leave can be added to the leaves that do not require 4 weeks written notice.

Alberta

On March 17, 2020, the Government of Alberta filed Regulation 29/2020 the Employment Standards (COVID-19 Leave) Regulation deemed effective March 5th that entitled employees to 14 consecutive days of unpaid leave if they are in self-isolation as a result of COVID-19.

Employees remain entitled to 16 weeks of unpaid leave in a calendar for illness or injury. On April 7, 2020, the Government of Alberta announced additional amendments that included the creation of an unpaid job-protected leave for employees caring for children affected by school and daycare closures or self-isolated family members due to COVID-19 and the length of this leave is flexible.

British Columbia

On March 23, 2020, the Government of British Columbia enacted Bill 16, Employment Standards Amendment Act No. 2, 2020 which added a new unpaid leave of absence for COVID-19. The COVID-19 leave is retroactive to January 27th, the date the first case was confirmed in the province.