Jackson And Associates
Current Trends

Group Benefits

Health Conditions

The Health Association of Nova Scotia surveyed their membership, which is comprised of employers in different industry sectors, to find treatments for inflammatory disease and not just for rheumatoid arthritis but for Crohn’s disease as well. The treatment for these conditions are with specialty medications which make up more than 30% of drug spend. Express Scripts Canada states a big component of that spend is for inflammatory conditions, referring particularly to Remicade which is used to treat types of arthritis and inflammatory bowel disease.

Medavie Blue Cross states treatment for diabetes – largely type 2 – is a factor in both growth and prevalence as the market introduces more medicines, some of which are also more expensive. Specialty Drug spending has grown from 15% of total spend in 2008 to 33% in 2018.

Changes to Provincial Drug Plans

Some provincial governments are making changes to certain high-cost biologic drugs under their plans, which will mandate the use of biosimilars versus biologic drugs. Biologic drugs are made from a living organism or its cells and are costly to produce. Biosimilars are biologic drugs that are similar to the biologic but can only enter the market after the patent expires for the originator biologic and are less expensive than the originator product.

In British Columbia, starting November 26, 2019, the Pharmacare program will only provide coverage for Enbrel (a biologic treatment for rheumatoid arthritis), Lantus (a treatment for Type 1 and 2 diabetes) and Remicade (a treatment for various arthritic conditions). The biosimilar equivalent will be covered – for Enbrel that includes Brenzys and Erelzi, for Lantus, it’s Basaglar and for Remicade it’s Inflectra and Renflexis.

In the 2019 Alberta Budget, they indicate they will be adopting a similar strategy January 2020 and will also be expanding the Maximum Allowable Cost pricing rules to limit drug benefit coverage to lower-cost alternatives that are clinically appropriate which is expected to include 1,600 drugs.

It's important that plan sponsors are aware of these lower cost alternatives when reviewing their drug costs and designing strategies for cost containment

Changes to OHIP Out of Country Emergency Medical Coverage

The Government of Ontario announced the end of their Out of Country Traveller’s Program. Starting January 1, 2020, the program will no longer cover any out of country emergency care including those for hospital rooms, doctor’s fees and treatments with the only exception being for Ontario residents requiring dialysis treatment.

Most group benefit plans providing this coverage will now be the first payor however many insurers have pre-existing condition exclusions for their coverage so it’s incumbent on those travelling to ensure any medical conditions will be covered.

Changes to RAMQ Coverage for Vision Care

Effective September 1, 2019, the Government of Quebec started paying $250 for corrective eyewear for anyone under age 18 per two year period. Some insurers now require proof that eligible Quebec plan members have accessed the RAMQ program for payment first for any purchases on or after September 1st and then any amount in excess of $250 may be eligible for reimbursement. This could impact on plan costs and the plan sponsor should ensure their insurer is administering the plan based on their desired approach.

Employers Expanding Benefits

Three recent surveys indicate Canadian employers are making salary adjustments but are also going beyond traditional benefits to address all aspects of their employee’s well-being. A survey by Arthur J. Gallagher & Co. suggests 66% of 506 Canadian employers surveyed will make salaries more competitive and a survey by Morneau Shepell suggests base salaries will increase by 2.7%. The Gallagher survey suggests salary isn’t everything as 34% of employers said they’re upgrading their well-being initiatives. A similar survey by Robert Half found these initiatives include physical (63% of participants), financial (65%) and mental (73%) wellness programs.

According to the Half survey, the most common perks offered are flexible work schedules or telecommuting options (50%), paid parental leave (47%) and employee discounts (42%) however, for employees, the most valued wellness offerings are fitness programs (24%), ergonomic evaluations and equipment (22%) and incentives for engaging in healthy behaviour (18%). A key for any initiative is the ability to track data so the employer has an indication for how they are impacting on the overall health of their workforce and accompanying benefit costs.

Savings Plans

Pension Statements And Missing Former And Retired Plan Members

In 2015, the Ontario Pension Benefits Act (PBA) was amended requiring plan administrators to provide information statements to all former and retired members every two years. The first set of such statements were to be done no later than July 2017 and the second set is due July 2019. However, some of these individuals cannot be located and the plan administrator needs to take appropriate steps.

According to Policy A300-900 Searching for Plan Beneficiaries, there are examples of search methods that include a registered letter to the last known address, internet and social media sites and professional search companies. If the plan administrator cannot locate the individual, they can choose to apply to the Ontario Superintendent of Financial Services for a waiver of the requirement to provide the statement. However, under the PBA, if the plan administrator does not wish to apply for the waiver, they should ensure that they have taken a reasonable and appropriate search for these individuals.

Will New Laws Protect Retirees?

Changes to the Canada Business Corporations Act (CBCA) received royal assent in June and amendments to the Bankruptcy and Insolvency Act (BIA) and the Companies’ Creditors Arrangement Act (CCAA) took effect November 1st. These changes are a result of government consultations in the wake of a number of high profile bankruptcies including Sears Canada Inc, Nortel networks Corp. and Algoma Steel Inc.

The changes to the CBCA have been expanded to include how directors consider the “best interests of the corporation” which now include the interests of the employees, retirees and pensioners. These changes also require directors to make information available to shareholders at annual meetings about the well-being of employees, pensioners and retirees. The BIA amendments require parties in an insolvency proceeding to act in good faith and allow the court to make inquiries about certain payments made to directors and/or officers of the company. Where the court does examine payments, those to whom they were made could be liable. The CCAA changes limit the relief to 10 days that the court can provide to a debtor company making an application under the act. It also allows the court to order the disclosure of the company’s interest and, like the BIA, requires all parties to act in good faith.

There are a number of other proposals being reviewed including restrictions on dividend payments, share redemptions and executive compensation under the CBCA if a company has a large pension deficit. It is also considering increased corporate reporting and disclosure requirements.

Legislative and Jurisprudence

Time To Review Accessibility Plans

Effective January 2014, private sector employers in Ontario had to have multi-year accessibility plans in place and posted on their websites. These changes are based on the size of the employer and must outline the employer’s strategy for preventing and removing barriers faced by individuals with disabilities, and for meeting all of the requirements under the Integrated Accessibility Standards, Ontario Regulation 191/11 (the Regulation).

The Regulation requires employers to review and update their accessibility plans at least once every five years. This applies to different size groups as follows:

  • 1 – 19 employees, no additional action required
  • 20 – 49 employees, need to file Accessibility Compliance report by December 31, 2020
  • 50+ employees, need to file Accessibility Compliance Report by December 31 2020

For more information, refer to:


Employer’s Duty To Accommodate

An employer’s duty to make inquiries of an employee when faced with red flags are now established and compel the employer to make inquiries when faced with such red flags which can include:

  • Excessive absenteeism
  • Sudden, clear changes in mood
  • Withdrawing socially
  • Tearfulness and expressions of hopelessness
  • Change in physical appearance
  • Symptoms of exhaustion
  • Unexplained deterioration in the quality of work

Best practice for the employer is to check-in with the employee for a check-up with their doctor to confirm whether any workplace accommodations are required for the employee and, if so, to what extent. This process may involve multiple stakeholders within an organization and sample inquiries include:

  • Whether the employee has a medical condition affecting their job performance including their ability to perform their regular duties and work their regular schedule
  • Whether any of the performance concerns are caused or contributed to by a medical condition and, if so, to what extent
  • What workplace accommodations to the workplace may be required and for how long
  • Whether the employee has been prescribed treatment for the condition and, if so, whether the employee is following the treatment as prescribed and whether the treatment may affect their effective or safe performance of their work
  • What the employee’s prognosis is for returning to work in their position or an accommodated position, their expected return to work date, and any gradual return to work recommendations; and
  • Whether a follow-up medical appointment is required and, if so, what frequency

Whether all or some of these inquiries are made, employers still need to recognize that dealing with chronic absenteeism may be a long-term project. It is important to establish a long-term game plan for managing employee absenteeism in a way that is constructive, rehabilitative and flexible.

Pay In Lieu of Notice for Disabled Employees – Or Not?

A recent summary judgement decision on a wrongful dismissal case in Alberta held that, while the reasonable notice period provided to the employee was insufficient, it had no practical effect as the employee was not entitled to any further payments from the employer after the employee became disabled and unable to work partway into their working notice period (reference Belanger v. Western Ventilation Products Ltd.) An employee received notice of termination by his employer and was given 12 months’ working notice. No pay in lieu of notice was offered. The employee, about the same time, became ill and unable to work. He subsequently started receiving disability payments and is expected to receive payments to age 65.

The Court held that an employee whose employment is terminated should not be put in a better position than one whose employment is not terminated. Since a disabled employee who cannot work is entitled to only their disability benefits, they should not suddenly be entitled to their full salary during a working notice period simply because their employment was terminated.

So, do employers have to pay severance to disabled employees ? According to this decision – NO ! This is predicated on the fact the employee was given working notice and not pay in lieu of notice and that the employee continues to qualify for disability benefits. The main point from this decision is that an employee becoming disabled during the reasonable notice period may be a factor to consider when determining an employee’s entitlements on termination of their employment.