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Category: Employee Group Savings Plan

Your One-Stop Guide: Exploring Key Themes in Employee Benefits

Posted on by Immix Group

A Guide to Immix Insights Articles

Are you wondering what we’ve been writing about? Perhaps you haven’t had time to read the articles, but you’re hoping to gain some information on a particular topic.

At the Immix Group, we strive to provide articles spanning a range of topics that are important to those in our Client Community. Recently, we have had some members of our Client Community reach out asking us to send them directly to a specific article they remembered reading, that they wanted to revisit.

With 2024 coming to an end, it occurred to us that many people might benefit from a ‘round up’ guide to the many Immix Insights articles we have written over the years. We hope you find this useful!

 

Group Savings Programs: Helping employees plan for their financial futures

We are passionate about helping employees to grow not only their retirement savings accounts, but their financial literacy skills.  We have written extensively on the many and varied benefits of an employer-sponsored group savings plan:

The common theme? You can help your employees relieve their greatest stress-their finances- through an employer-sponsored Group Savings Program.

Most recently, for November’s Financial Literacy Month, we highlighted our partnership with our sister company Ciccone McKay Financial Group, who provide valuable financial planning resources and products to members of the Immix Group Client Community. Read about how to access these services in our article: Financial Well-being: Valuable Resources through our Partnership with Ciccone McKay Financial Group.

 

Understanding Pricing of Employee Benefits Programs

When it comes to pricing, we know you have a lot of questions. How does it work, why do the rates change, and most importantly, is there a better option out there? We have written extensively on how employee benefits programs are priced including related information on the various funding options for programs and the taxation of benefits.

We believe that pricing should be transparent- you should understand where your benefits dollars are going, and the value you are getting for the premiums you pay.

 

The Immix Group’s Unique Broker-Managed Pools

Unique to the Immix Group, we have discussed our popular broker-managed pricing pools, which are structured to extend flexibility, transparency and choice to plan sponsors, but within the protection of a pricing pool. The primary goals, however, are reduced administration charges and accordingly, long-term cost containment.

In addition to cost controls, paramount to our philosophy is exceptional, hands-on support for our Client Community. As we often say, we consider ourselves an extension of your HR team.

 

Exploring Your Options: Marketing your benefits program

Are things not quite right with your benefits program? Or, is it time to test the waters and see what’s out there? We’re happy to take a look at your program and offer a free review, and for those in our Client Community, we’re happy to shop the market on your behalf! We work with all the major (and many of the smaller) providers in Canada. But a quote for benefits isn’t just about looking at the bottom line; we’ve written about what to look for, given the many nuances of the marketing process.

More importantly, you will notice we emphasize the importance of working with a trusted advisor to guide you through the many intricacies of a comprehensive employee benefits program, as well as the importance of regularly assessing whether your program aligns with your organization’s values and purpose for the plan. 

 

Exploring Plan Design and Changes

Things change- your business, the economy, government healthcare. If your benefits program is beginning to feel inadequate, it may be time for a small tweak or even a total overhaul.

The articles below explore the importance of surveying your staff and updating coverage to meet current standards while addressing the unique needs of your demographics—key steps to standing out as an employer. We also emphasize the value of regularly assessing whether your program aligns with your organization’s values and the purpose behind the plan.

 

Laying the Foundation: Setting up a new plan

Just getting started? We know that the decision to implement benefits is tricky. Is your company large enough, can you afford it, how does it all work? We’ve got you covered, and have written about the many considerations that relate to getting started.

You will notice that we have included articles written about the popular Health & Wellness Spending Accounts, which continue to be a great option for small businesses wishing to provide flexible healthcare spending dollars to employees, at a predictable cost.

 

Mental Health Support for Employees  

Especially since the pandemic, we have seen an upsurge in requests for enhanced mental health support within employee benefits programs. But what does this mean? What really is effective, and what are employees seeking?

Employee and Family Assistance Programs play a vital role in supporting employee mental well-being, but simply paying for this program is not enough. Read about how to communicate the plan to staff, ensure plan members know how to access practitioners within their plan, and other ways you can support your team in this area.   

We have included our articles on Virtual Health, as these articles highlight online mental health support programs.

 

Special Topics: Disability Insurance, Travel Coverage, Fraud in Employee Benefits and More

 

Travel Insurance: What to know before takeoff

One of the things that comes up frequently when we conduct an employee education session is the inclusion of emergency out-of-country travel insurance in most extended healthcare plans. Employees are often not aware of this coverage and have many questions surrounding limitations, exclusions, the duration of coverage and what to do in the event of a claim.

 We’ve laid out the answers to all the FAQ’s in these articles.

 

Disability Insurance: The most misunderstood area of employee benefits

Despite its importance, one of the most overlooked areas of insurance- and employee benefits- is disability insurance. Disability insurance plays a critical role in protecting employees and their families when the unexpected happens.

Over the years, we’ve provided insights on how to ensure the right coverage is in place, understanding the differences between group long term disability and individual disability insurance, and most importantly, the options available to address the diverse needs of today’s workforce.

 

Working from Home: Is this an “employee benefit”?

Although COVID-19 is behind us, “WFH” is here thttps://canadianfamilyoffices.com/o stay. Employees have embraced the flexibility and balance it offers, while employers are navigating the impact on productivity, collaboration, and workplace culture.

 

This topic continues to make headlines for numerous reasons, from its influence on employee satisfaction to its role in attracting top talent.

 

Employee Benefits Fraud: it’s more common than you think!

Fraudulent activity within employee benefits programs can be costly and damaging. These articles provide valuable insights into recognizing, preventing, and addressing benefits fraud, helping businesses protect their assets and maintain a secure benefits program

Most people are shocked to learn how common benefits fraud is, and the many varied ways your program may be vulnerable.

 

Key Conversations: Yearly recaps

Lastly, “Key Conversations in Benefits” remain our most popular articles! Stay tuned for January’s article, which will highlight the main topics of 2024.

In the meantime, feel free to see what has made the headlines over the past years, what has stayed, and what has evolved in the world of employee benefits.

 

That’s a Wrap for 2024!

As 2024 draws to a close, we hope the insights we’ve shared throughout the year have been both helpful and informative in navigating the world of employee benefits.

Whether you’re revisiting familiar ideas or seeking new perspectives, these articles are great to explore when reflecting on your current plans or considering fresh approaches for the year ahead. We have some great articles planned for 2025 and look forward to sharing them!

As always, if you have any questions, feel free to reach out to us at info@immixgroup.ca or give us a call at (604) 688-5559 – we love to hear from you!

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Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

Latest Insights

Financial Well-being: Valuable Resources through our Partnership with Ciccone McKay Financial Group

Posted on by Immix Group

By: The Immix Group in partnership with Ciccone McKay Financial Group

November marks Financial Literacy Month in Canada, and this year’s theme, “Money on Your Mind. Talk About It!”, focuses on encouraging open conversations about personal finances. This month, we want to highlight how employers can support their employees’ financial well-being, beyond standard employee benefits, through the unique access that members of the Immix Group Client Community have to our sister company, Ciccone McKay Financial Group.

 

What is Financial Literacy and Why is it Important?

Financial literacy refers to the ability to understand and manage personal finances effectively. It goes beyond just earning a paycheck—it’s about empowering individuals with the knowledge, resources, and confidence to manage their financial health today and for the future. Financial literacy encompasses:

  • Knowing how to budget and save
  • Managing debt effectively
  • Planning for retirement and other long-term goals
  • Making informed financial decisions

For employees, mastering these skills can significantly reduce financial stress, improve focus at work, and contribute to overall well-being. With financial concerns consistently ranking as the #1 stressor for Canadians, it’s clear that promoting financial literacy can have a substantial impact on an individual’s mental and financial health.

 

Supporting Employee Financial Well-Being

At the Immix Group, we recognize that financial wellness plays a critical role in an employee’s overall well-being, and supporting this goes beyond just offering competitive pay and comprehensive employee benefits. While there are many ways you can increase financial wellness through employee benefits such as group savings programs and health/wellness-related resources, we believe that knowledge is the ultimate power when it comes to financial wellness. This is where financial literacy steps in.

In all of our education sessions and update meetings, we consistently emphasize the resources available to your team through our sister company, Ciccone McKay Financial Group. The goal of this article is to provide an in-depth look into the financial services our sister company, Ciccone McKay Financial Group, offers to members of the Immix Group Client Community, the type of support your employees can expect to receive, and how to get started.

 

Immix Group’s Background in the Financial Services Industry

Established in 2003 (but with roots dating back much further!), Ciccone McKay Financial Group has been providing tailored wealth management services, with a strong focus on helping individuals and organizations protect, preserve, and grow their wealth. The Immix Group- which focuses on employer-sponsored benefits programs– was established as a separate company in 2010 but existed previously as a division of Ciccone McKay Financial Group. Thus, our ties are strong!

Today, we still share an office meaning the Immix Group team and the Ciccone McKay team are able to collaborate and leverage the varied experience and specializations of the entire team. Across both the Immix Group team and the Ciccone McKay team we hold a wide range of highly regarded credentials in the financial services industry such as the Certified Financial Planner (CFP) designation and Trust & Estate Practitioner (TEP). This deep financial expertise is a valuable resource to your business and employees.

 

Resources Available to members of the Immix Group Client Community via Ciccone McKay Financial Group

As a member of the Immix Group Client Community, your team has access to the seasoned professionals at Ciccone McKay Financial Group. This includes personalized financial services (see in next section) and educational workshops such as:

  • Financial Planning 101: Building a Balanced Financial Portfolio
  • Setting Financial Goals: Short, Mid, and Long-term Strategies
  • The Power of RRSPs: How to Maximize Savings
  • Your Health is Your Wealth: Exploring Critical Illness, Disability, and Long-Term Care Options
  • Individual Pension Plans (IPPs): Supercharged RRSPs for Business Owners & Executives

These customized workshops aim to provide knowledge, actionable advice, and help your employees gain the confidence they need to take control of their financial future. Interested in arranging an educational workshop for your organization? Click here to contact us and organize a session for your team!

 

The Support Your Employees Will Receive from Ciccone McKay Financial Group

While the employee benefits program provides a strong foundation for financial health, every employee is different, and customization is required in the form of additional insurance and investment strategies and products. 

Through Ciccone McKay, your employees can access a range of financial services, including:

  • Insurance Products (e.g., Life, Disability, Critical Illness)
  • Registered Investment Accounts (Setting Up RRSP, TFSA, and RESP Accounts)
  • Non-registered Investments (Virtual Bank Accounts)
  • Manulife One (Mortgage Banking Account)

 

Here’s how your employees can get started with a Ciccone McKay advisor:

  1. Let’s get in touch: Reach out to your Immix Group service contact person with the employee’s contact information and a brief description of the assistance they’re seeking.
  2. Advisor match: We’ll pair them with an advisor from the Ciccone McKay team who best fits their needs.
  3. Introduction call: The advisor will reach out to schedule a brief introductory call or virtual meeting to assess the employee’s financial situation and needs.
  4. Strategy Discussion: Depending on their needs, the advisor may have an in-depth conversation to discuss products and solutions.
  5. Ongoing engagement and follow-up: The advisory team will provide clear guidance and regular updates, ensuring a seamless process every step of the way.

We encourage plan administrators and HR teams to share this resource with your employees. It’s an excellent way to add value to your employee benefits package and show your team that their financial well-being is a priority.

For easy sharing, we’ve attached a one-pager that outlines this service.

Sharing link: One Page Summary for Sharing

Feel free to distribute it to your employees directly. If you have any questions or need more information, don’t hesitate to reach out. As always love to hear from you!

Did you know?

  • Personal finances and workload remained the top two main sources of stress for Canadians. (Benefits Canada Survey)
  • Only 13% of employee benefits plans include financial support programs (Benefits Canada Survey)
  • 40% of Canadians Report their financial situation as poor or fair. (View the report)

Additional Resources:

Financial Literacy Month: Money on your mind? Talk about it!

Financial Literacy Month in Canada

Promotional toolkits for financial literacy and consumer protection

Introduction to Ciccone McKay Financial Group

One size fits all? Not when it comes to employee benefits.

Money remains the top source of stress for Canadians

Financial stress and its impacts

Three Reasons to Implement a Group Savings Plan

A Step-by-Step Guide to Individual Health & Dental Plans

Mental Health Support: A Simple Guide to Providing Mental Health Coverage within your Employee Benefits Program

Meet the Immix Group Employee Benefits Team

Immix Group – Education Session Available

Contact the Immix Group

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Expanding into Canada

Posted on by Immix Group

Expanding into Canada? What Non-Canadian entities need to know when implementing an Employee Benefit program in Canada

Key Takeaways

  1. A typical employee benefits plan in Canada includes life insurance, extended health care, dental care, and often additional offerings like disability insurance, health spending accounts and retirement savings plans.
  2. The healthcare component of employee benefit programs is complementary to the coverage provided via provincial coverage, under Canada’s universal healthcare system.
  3. Navigating provincial regulations and employment standards is critical, making it important to work with licensed advisors who understand the Canadian market.
  4. Offering a robust benefits package is key to attracting and retaining skilled employees in Canada’s competitive job market.
  5. Customizing benefits to meet the specific needs of your Canadian workforce and industry will help ensure your company’s long-term success in Canada.

This year alone, the Immix Group, based out of Vancouver, British Columbia, has set up employee benefit programs for businesses head-officed in multiple countries around the world. Whether you’re in Australia, Singapore, Ireland, or the United States, there are key pieces of information to know if you are setting up a Canadian entity.

Companies are driven to expand into Canada by many factors including market opportunities, economic conditions, and strategic considerations. In particular, the highly educated, diverse workforce makes Canada an attractive location for companies, often at a lower cost than expansion to comparable locations.  

To be competitive and successful in this expansion, companies must consider providing the right set of employee benefits for their Canadian employees. And this involves understanding the legal requirements and offering the right benefits. Here’s a list of key things to help you navigate the process:

 

The Basics: Canada has a Universal Healthcare System

Canada has universal healthcare, which is adjudicated provincially; this means coverage differs slightly depending on the province or territory of residence of your employees. All employees must be residents in order to qualify for provincial healthcare.

The reason this is important is that employer-sponsored extended health and dental programs may require provincial healthcare to be in place, as the two programs are complementary.  

For most full-time permanent employees in skilled positions, the expectation is that the employer will provide an employee benefits program with a range of coverage. However, providing an employee benefits plan is not mandatory (please note the province of Quebec has special requirements) and coverage levels differ significantly from employer to employer. Many employers do not provide any extended benefits at all.

While not mandatory, a comprehensive benefits program is integral in attracting and retaining talent, and in protecting and promoting the well-being of employees.

What coverage does a typical Canada employee benefits plan include?

 

Within Canada, when one refers to their employee benefits plan, they are usually referring to the insurance package their employer sponsors, which is typically facilitated through a major insurance provider (Manulife, Sun Life, Canada Life, Blue Cross, RBC Insurance etc).  

We will indicate the most basic components of an employee benefits program, followed by additional benefit offerings that comprise a more comprehensive offering.

The following are the core components of a group benefits plan:

 

Life Insurance

Life insurance amounts are usually either a small flat amount of coverage such as $25,000 or a salary-based benefit such as 1 x earnings, to a maximum. Higher amounts of coverage are usually extended to those in larger companies, or for more highly skilled professional firms employing those in more “white collar” occupations.

Accidental Death & Dismemberment (AD&D) is usually included alongside the Life insurance benefit, for the same amount of coverage.

For small groups, Life Insurance and AD&D are usually a very inexpensive component of the program, often running just a few dollars per employee, per month. The cost varies depending on the demographics of the group, and the overall volume insured.

Extended Health Care

As mentioned previously, Canada has universal health care. Extended Health Care is exactly that – an extension of the basic components provided through the provincial programs. Provincial healthcare is complex and differs across the country. The most simple way to understand what an employee benefits plan provides is to focus on the core components of a typical extended health care package:  

  • Prescription drugs
  • Paramedical practitioners (massage, physiotherapy, chiropractor, naturopath, therapists etc).
  • Vision Care (eye exams, contact lenses, glasses)
  • Medical Equipment (orthotics, knee braces, crutches, wheelchair)
  • Emergency Medical Travel Insurance

The categories listed above fall outside the scope of what is covered through our provincial health care, which provides coverage for doctor visits (including specialists), hospital care, surgeries, diagnostics etc. There are exceptions to all of the above, for example, for low-income households, children, or certain medications such as those dispensed in hospitals.

In short, while we have a robust universal healthcare system in Canada, many day-to-day routine medical expenses are not covered for average working people, and thus, an employer-sponsored group benefits program fills this gap.  

A typical extended health care program will provide coverage for the areas listed above; where a plan becomes more competitive than another is based on the percentage of reimbursement and dollar limits included for various items. It is important to use a qualified advisor who knows the market in order to ensure you are providing a competitive program for your industry, size and location.

Dental Care

For most people, dental coverage comes via their employer program. It is not part of Canada’s universal healthcare system, although programs exist to provide dental coverage to low-income individuals (including the new Canadian Dental Care Plan).

A typical dental plan provides at minimum “basic” coverage which includes cleanings and routine maintenance procedures. The second level of coverage is for “major” dental, followed by a third level, for orthodontics.

It would be common to see a small employer provide only basic coverage, whereas a larger company, or those with highly skilled professionals on the higher end of the income spectrum, tend to provide better dental coverage.

 

In addition to the core components listed above, many programs provide:

  • Long Term Disability insurance
  • Short Term Disability insurance
  • Critical Illness insurance
  • Health & Wellness Spending Accounts
  • Retirement Savings Plans

Long-Term Disability Insurance

Group Long Term Disability insurance provides salary continuance for those who are unable to work due to injury or illness and are therefore deemed “disabled” per the terms of their contract. Typically, Long Term Disability begins after 120-180 days of disability.

During these initial months, a person would be either on Short Term Disability coverage or would claim EI Sickness benefits through Service Canada (the federal government). This is a program that people pay into, as part of payroll taxes.

Many smaller employers do not provide group long-term disability insurance; they may not qualify to obtain this coverage, or they may choose to exclude it due to reasons such as cost.

Short-Term Disability Insurance

While most employers rely on Employment Insurance Sickness Benefits rather than insuring Short Term Disability, insuring this benefit does make sense in certain industries and for specific demographic profiles. Federal EI Sickness Benefits are 55% of weekly earnings to $668 per week (taxable, 2024 amount) so an obvious reason to insure this benefit is for greater coverage amounts that provide for greater income replacement levels. There are other advantages as well, which a qualified advisor can assist you in understanding.

Critical Illness Insurance

Critical Illness insurance provides a lump sum payment based on the diagnosis of one of the covered illnesses (cancer, heart attack, stroke, MS, for example). This is different than Long Term Disability insurance in that it provides a lump sum payment, rather than an ongoing income stream, and you can claim while still actively at work. Comprehensive programs often include this coverage in amounts ranging from ~$10K to $50K per employee.  

Health & Wellness Spending Accounts

An extremely popular offering, Health & Wellness Spending Accounts provides a lump sum dollar amount to be used at the employee’s discretion, for health and/ or wellness expenses.

In Canada, Health Spending Accounts usually refer to non-taxable medical expenses that the Canada Revenue Agency lists as “eligible.” In contrast, Wellness or Lifestyle Spending Accounts cover other items related to fitness and lifestyle and are a taxable benefit to employees. The amounts extended to employees vary significantly between employers, but it is important to remember that a Health Spending Account is intended to supplement insurance, rather than replace it.  

As HSA in the U.S (“Health Savings Account”)  is commonly used, please note that HSA in Canada (Health SPENDING account) should not be used or googled interchangeably. They have some similar aspects but operate totally differently.

Group Retirement Savings Plans

 Many employers provide their employees with Group Retirement Savings plans. In Canada, these typically take the form of a group Registered Retirement Savings Plan (RRSP), often in combination with a Deferred Profit Sharing Plan (DPSP). The purpose of these programs is to assist employees in saving for retirement, in a tax-advantaged way. The Immix Group has written extensively as to the benefits of group retirement savings plans for both employers and employees.

Also, please note that both the employer and employee contribute to the Canada Pension Plan (CPP) or Quebec Pension Plan (QPP). The contribution rates change annually. This is a mandatory payroll tax and would not be considered an ‘employee benefit’ here in Canada, although it does provide income in retirement.

  

Other Important Considerations

 

Maternity and Parental Leave

We are often asked about Canada’s well-known maternity and parental leave policies. In short, Employment Insurance (which provides for Sickness benefits) also provides benefits during maternity and parental leave. The formula used is the same, at 55% of weekly earnings, to a maximum ($668 per week, 2024). The choice of either 12 months or 18 months of leave is indicated upfront; you receive the same amount of total pay (i.e. if you choose the 18-month option, your payment is lower than under the 12-month option).

There is extensive information on the Service Canada website regarding EI Maternity and Parental benefits. There is very little involvement by the Employer in this matter; employees apply directly to Service Canada and are paid directly.  

Additionally, some employers will provide ‘top-up’ pay for those on maternity leave either for a portion or for the entire duration of the leave. This practice varies significantly between employers.

 

Vacation / Paid Time Off

The Employment Standards legislation in each province and territory sets out the minimum legal requirements. In practice, many employers exceed these minimums when it comes to Paid Time Off. Depending on the province, employees may have minimum paid sick days as well; for example, in BC, employees are entitled to 5 paid sick days which is available to both part-time and full-time workers.


Workers’ Compensation Insurance (WCB):

Certain industries require employers to set up workers’ compensation insurance; this is managed at the provincial/ territorial level. Employers fund workers’ compensation through premiums. This program coordinates with other insurance; for example, an injury on the job would result in disability paid via worker’s compensation, rather than through the long-term disability insurance program.

 

Working with a Licensed Employee Benefits Advisor

 Insurance providers require that Employers work with licensed insurance advisors in order to obtain pricing and implement and manage a group benefits program on an ongoing basis. In addition to being a requirement, employee benefits experts such as those at the Immix Group can advise you each step of the way. Advisors provide:

  • Knowledge of Providers: Recommend reputable insurance providers and benefit administrators who operate in Canada. This often is part of the market survey process.
  • Customize Benefits Package: Tailor the benefits package to align with the specific needs and preferences of your Canadian workforce. Consider utilizing templates from the advisory team to conduct surveys or interviews to understand the group’s priorities.
  • Compliance with Collective Agreements: Ensure that your benefits package adheres to the regulations of the province(s) where your employees are based. Be aware of any collective agreements that may apply.
  • Effective Communication: Having benefits is one thing, clearly communicating the benefits package to your Canadian employees is another. Provide written materials and in-person/online meetings explaining the benefits, enrollment procedures, and other relevant information.
  • Smooth Enrollment Process: Implement an efficient enrollment process for Canadian employees. This could involve online portals, paper forms, or a combination of both.
  • Training and Support: Offer training and support to your HR staff responsible for administering the benefits package. Ensure they understand Canadian regulations and can address employee inquiries.
  • Regular Review and Updates: Periodically review the benefits package to keep it competitive and compliant with Canadian laws.

 

What do you need to get started?

When it comes to branching out into Canada, here are some key considerations:

  • Are the employees Canadians or relocating to Canada?
  • Is the company incorporated in Canada?
  • Is Canadian payroll established?
  • Do you have at least 1 or 2 employees already hired?

 

Expanding your business into Canada offers tremendous opportunities, but understanding the local landscape, particularly when it comes to employee benefits, is crucial. With Canada’s unique healthcare system, employment standards, and regional variations, it’s essential to work with experts who can guide you through the complexities. By aligning your offerings with the expectations of Canadian employees, you set a strong foundation for your company’s success in this new market.

If you’re ready to get started, our team at Immix Group is happy to help! Email us at info@immixgroup.ca or call us at (604) 688-5559. We love to hear from you!

FAQs

The first step is to determine whether your company is incorporated in Canada and whether you have established a Canadian payroll. This ensures compliance with Canadian regulations and allows you to provide benefits that meet local standards.

Canada’s universal healthcare system covers basic medical needs, but it does not cover services like prescription drugs, dental care, or vision care. Employer-sponsored benefits typically supplement these areas, providing additional coverage for employees.

A typical benefits plan in Canada includes life insurance, extended health care (covering prescription drugs, paramedical services, and more), dental care, and possibly long-term disability insurance and retirement savings plans.

Yes, there are regional variations in healthcare coverage and employment standards across Canada’s provinces and territories. It’s important to tailor your benefits program to align with the specific regulations and needs of employees in each province where you operate.

While it’s possible to offer a standard benefits plan, it’s often beneficial to customize the plan based on the specific needs of your Canadian workforce, industry, and location. Consulting with a local advisor can help you make these adjustments.

Licensed advisors are essential in helping you navigate the Canadian market. They recommend reputable insurance providers, ensure compliance with local regulations, customize your benefits package, and assist with effective communication and enrollment processes.

Clear communication is key to ensuring employees understand and appreciate their benefits. This can involve providing written materials, holding in-person or online meetings, and offering ongoing support to answer any questions your employees may have.

Read more:

Government of Canada – Employee Benefits Overview

Canada Life – Group Benefits for Employers

Prescription Drug Insurance | Régie de l’assurance maladie du Québec (RAMQ) (gouv.qc.ca)

How Does Workers Compensation Work in Canada? – Canadian Payroll Services

Manulife – Employee Benefits Solutions

Sun Life – Employee Benefits and Group Insurance

Blue Cross – Employee Benefits Plans

Howard 2

Howard Cheung | BBA | Employee Benefits Consultant

Three Reasons to Implement a Group Savings Plan

Posted on by Immix Group

We write often about Group Savings Plans, as it’s our belief that one of the best ways employers can assist their employees is by offering them the opportunity to plan and save for the future.

This is a sentiment that is echoed by many in our industry. In their recent 2023 recap, iA’s Director of Plan Member Wellness and Education stated the need to evolve our thinking when it comes to group savings programs, and more specifically, to “develop engagement strategies that focus on supporting people to achieve their personal goals.”

Our interpretation of this comment is that your purpose in setting up a Group Savings Plan should extend beyond simply finding a way to provide more funds to your team, or setting up a plan just because you need to be competitive with similar employers. Employees are self-reporting that they are feeling significant stress, and the number one reason is due to finances. It goes without saying that everyone has many and varied personal goals related to achieving financial peace of mind.

The three reasons to implement a group savings plan we are focusing on here focus on these facts: the support is needed, the tactic is effective, and implementation is simple.

 

 

1. Employees need support when it comes to financial literacy training and tactics to get them on track in this area of their lives

 

As we wrote about previously, a Group Savings Plan targets a key stressor for employees- their finances. The stats are clear, as reported via the 2023 Benefits Canada survey as well as through the Financial Consumer Agency of Canada:

  • 32% of Canadians report feeling a high level of anxiety, stress, or worry over money.
  • Only 49% of Canadians describe themselves as financially knowledgeable.
  • 36% feel they are just getting by, financially speaking.
  • 67% of Canadians said their debt increased by more than $5,000 in the past 12 months.
  • 53% have an emergency fund (2023), down from 64% in 2019.

As the image from the Benefits Canada Survey shows, “Personal Finances” continues to rank #1, followed by Workload and Work-Life Balance.

Screenshot 2024 02 29 at 10.04.40 PM

The answer is not simply to ‘pay people more’. Equipping people with the ability to save in a systematic and tax-effective manner, and contributing to these savings through an Employer match goes a long way. Additionally, and most importantly, Group Savings Programs provide employees access to education resources, planning tools, and financial advisors that they may otherwise not bother to seek out. Access to financial advisors to help employees achieve their personal financial goals, even if it’s as simple as developing a budget to assist with living within one’s means, can create a lasting impact and potentially redirect the trajectory of one’s financial future.

Simply put, a Group Savings Program is an opportunity to assist your employees where they need it most.

 

2. It provides an immediate, twofold beneficial impact as savings grow and taxes are reduced

 

Contributions to an RRSP (Registered Retirement Savings Plan) reduce taxable income. The difference with a Group Savings Plan is that contributions are made directly via payroll deductions.  When employees contribute to an RRSP directly from their paycheque, they experience income tax savings in real-time, as they are taxed on their after-contribution income.

We mentioned earlier the perspective that employers should seek strategies to assist employees in reaching their personal goals. Many employees identify financial goals, and particularly the development of a retirement savings account, as incredibly important.

Over time, and with engagement with the many planning tools available, an employer-sponsored program assists in creating a sense of achievement and tangible progress as retirement savings grow.

An added bonus? The Employer contribution. While not mandatory, this of course serves to boost an employee’s account value, taking them more quickly towards their goal.

 

3. Simple, low touch, high ROI

 

Lastly, it cannot be overstated how simple it can be to implement and manage a group savings plan. In contrast to the requirements of a pension plan, a simple group RRSP or group RRSP-DPSP combination plan is very low touch from an administrative perspective.

Even a very small employer can easily implement a Group Savings Plan that provides similar access to all the features (online platform, resources, investment funds, planning tools, etc.) that a much larger employer offer. It’s a way to recruit, retain, and remain competitive. In short, implementing a group savings plan provides a great return on investment.

Already have a group savings plan in place? Here are a few checkups:

  • Have you taken advantage of our offer to host an education seminar?
  • When was the last time you assessed the contribution level made by the Employer? Has it kept pace with inflation?
  • When was the last time you reviewed Employee contribution levels? Have employees been reminded that they can increase their payroll deductions, again, to keep pace with inflation or changing circumstances?
  • When did you last run an audit of participation levels? Is everyone who is eligible to participate enrolled?
  • Are you aware of and communicating the many comprehensive resources available through your provider and advisor?
 

Help employees to save for the future

 

In summary, implementing a Group Savings Plan is a direct response to the financial stress reported by employees. Beyond immediate benefits like tax-effective contributions and employer matches, it offers a straightforward and high-return solution to recruit, retain, and stay competitive. By addressing employees’ financial concerns holistically, it not only eases stress but also fosters financial growth and supports personal goals.

At the Immix Group, we recognize the importance of financial literacy which is why we offer lunch and learn seminars where we explain, simplify, and guide our clients through their programs to help them maximize their benefits. Additionally, our clients have direct access to our sister company, Ciccone McKay Financial Group, where dedicated advisors are available and ready to provide personalized assistance.

It’s desired, it’s beneficial, and it’s simple to implement and administer! If it’s been on your mind to look into a plan for your employees, we’re happy to help you discuss options.

FAQ

Beyond just funding your team or competing with other employers, it addresses the top stressor reported by employees—financial concerns.

By enabling systematic savings and offering tax-effective contributions, it directly tackles the rising anxiety and lack of financial knowledge reported by Canadians. It also provides employees access to education resources, planning tools, and financial advisors that they may otherwise not bother to seek out.

It offers real-time income tax savings as contributions are made directly from paycheques, creating tangible progress toward personal financial goals.

While not mandatory, this of course serves to boost an employee’s account value, taking them more quickly towards their goal.

It’s simple, low-touch, and offers a high return on investment, making it easy for employers to implement and manage.

It requires minimal administrative effort, making it accessible even for small employers to provide features similar to larger employers.

Implementing a Group Savings Plan enhances competitiveness, contributing to employee satisfaction and loyalty.

Regularly assess Employer and Employee contributions, participation levels, and leverage available resources for ongoing plan success.

Further Reading

Add to your Recruitment and Retention Toolkit with a Group Savings Plan – Latest News from Immix Group

3 Action Steps Employers Can Take to Reduce Employee Financial Stress and Increase Financial Literacy – Latest News from Immix Group

Business Owners: How to Design the Best Group Savings Plan for your Company

This might just be the right time for you to implement an employee group savings plan – here’s why and how

Canadians’ Financial Well-being: Summary of FCAC survey findings – Canada.ca

Report | Benefits Canada.com

Top Benefits Conversations of 2022

Posted on by Immix Group

It’s a wrap! As we begin the New Year with refreshed energy and excitement for what 2023 may bring, we wanted to share a recap of the key stories in benefits over 2022.

 

Extreme Difficulty in Hiring

The theme of our client meetings this year can be summed up in one simple sentence “Where did all the people go?” Businesses struggled to hire (and retain) qualified people. Employers told us they had candidates ‘ghosting’ interviews or simply not showing up to their first day, a trend that most had never previously experienced.

Time and again we were told by employers that they were desperately in need of staff, and that their existing team members were stretched too thin or in roles they were not hired or properly qualified to fill. The labour shortage is evident with a record-tight labour market, according Stats Canada: Labour shortage trends in Canada (statcan.gc.ca).

“Salary and benefits” continue to top the list of most important job factors for employees. Providing and more importantly communicating and highlighting a competitive benefits offering will make you stand out.

top benefits2

The Shift to Hybrid Work

There has been a massive shift in how we work over the past few years. Hybrid work, or working partly remote and partly in-office became the norm post-pandemic, with most employees reporting they prefer working from home.

This has had a big impact in terms of managing and hiring, measuring performance, and ensuring engagement. We wrote about hybrid work and posed the question: Is working from home an employee benefit in two parts. The basic takeaways are that remote work is here to stay, employees prefer a hybrid model, and a formalized WFH policy is a must. 

 

The Great Resignation, or rather, the Great Retirement

The much-discussed Great Resignation did not occur in Canada like it did in the US, but what Canada experienced is actually more concerning:  a record number of retirements.

A record 300K people retired in Canada in the 12 months up to July 2022 (up 30% from the same period the previous year). Early retirement, so those between age 55-65, made up almost half of the overall number of retirees. With our demographics here in Canada, it will only grow larger. With the most experienced people exiting the workforce, there is a real risk to businesses due to the lack of mentorship and transfer of knowledge for younger generations.

How does this tie into benefits? Offering those in the final stages of their career enhanced coverage and work flexibility are potential solutions to entice your most experienced people to stay a few additional years.

 

Continued Focus on Mental Health and Well-being

As we transitioned out of the pandemic, the focus on mental health remained at the forefront. Employers continued to ask for resources and coverage options to ensure their staff had access to the mental health support they required.  

Far beyond the EAP or the dollars available for counselling visits, employers sought various ideas to support mental health including: return to work plans, 4-day work weeks, assisting employees with financial concerns through financial literacy and group savings plans and other programs designed to provide the flexibility needed to better support individuals and families and remove barriers to care.

More than one third of all 2022 Long Term Disability claims are mental health related. Claims for mental health are up 75% from 2019, and experts anticipate this will rise in 2023.

 

High Inflation

A key conversation in 2022 was the inflation we saw across the board; this was especially noticed with the cost of groceries. After years of low interest rates, Canada experienced eight interest rate adjustments in 2022. For many people, this directly impacted their borrowing costs, affecting both personal and business expenses and decisions.

2022 saw increases to the Dental fee guides far higher than historical averages. Unfortunately, it appears that the Dental Fee Guide increases for 2023 will once again be much higher than usual, with 8.5% for Ontario and 9.8% for Quebec already reported. With costs for practitioners and other insured expenses also rising, we anticipate larger than typical increases to claims across plans.

 

Federal Dental Plan

The Federal Dental Plan was rolled out the end of 2022. Employers had many questions on this program, wondering the impact to their Employer-sponsored insured dental plans. Generally speaking, there is little or no impact on existing plans, due to the qualification parameters for the new Federal plan.

The program provides coverage for children under 12 only. In order to qualify for any level of coverage, family income must be under $90K, and the children must not have access to private dental coverage (i.e. Employer plans). The government states that this is the first stage in developing a more comprehensive federal dental plan; only time will tell!

 

Change to EI Sickness Benefits

Effective for December 18th, 2022, the Federal Government announced a change to EI Sickness benefits, extending the duration of pay from 15 weeks to 26 weeks. Employers had many questions about this and the impact on their insured Long Term Disability programs which typically begin at week 17, at the expiration of EI Sickness payments.

In short, Employers are not required to adjust their LTD plans. Generally speaking, it is not in the best interest of those who are insured under LTD plans to remain on EI Sickness rather than transitioning to LTD. 

top benefits3

Flexibility in Benefits

 
Finishing up the list, an underlying theme to benefits conversations in 2022 was the desire for flexibility and customization. As we know, one size does not fit all when it comes to benefit plans, which these days must include elements of flexibility to ensure everyone’s needs are met. We saw employers embracing customized work arrangements including hybrid work models and four-day work weeks.

From a product standpoint, the Immix Group set up more Health & Wellness Spending Accounts than ever before as Employers sought a simple way to provide spending flexibility to their team.

As always, we are happy to discuss your program with you!

Please reach out to us to discuss how we can help with your program; we love to hear from you.

 

Read more:

 

Labour Shortage Stats Can:

https://www.statcan.gc.ca/en/subjects-start/labour_/labour-shortage-trends-canada

 

Retirement:

https://www.theglobeandmail.com/business/commentary/article-the-great-resignation-has-arrived-in-canada/

https://thehub.ca/2022-09-20/trevor-tombe-canadas-not-so-great-resignation-its-retirements-we-should-really-be-worried-about/

https://www.benefitscanada.com/benefits/health-wellness/how-can-employers-turn-the-great-resignation-tide/

 

Hybrid Work:

https://www.benefitscanada.com/news/bencan/survey-finds-78-of-canadian-employees-prefer-working-from-home/

https://www.benefitscanada.com/news/bencan/61-of-canadian-employers-using-hybrid-work-model-survey/

https://immixgroup.ca/blog/index.php/2022/03/23/the-hybrid-work-model-is-working-from-home-an-employee-benefit-2022/

https://immixgroup.ca/blog/index.php/2022/04/19/part-2-the-hybrid-work-model-is-working-from-home-an-employee-benefit/

 

Inflation:

https://www150.statcan.gc.ca/n1/en/catalogue/62F0014M2022014

https://www.sunlife.ca/workplace/en/group-benefits/focus-updates/over-50-employees/provincial-dental-fee-increases-for-2022/

8 Reasons for Increases to your Employee Benefit Plan Premiums    – Latest News from Immix Group

 

Mental Health:

More than a third of disability claims in 2022 due to mental-health reasons: survey | Benefits Canada.com

Mental health claims soar by 75 per cent | Canadian HR Reporter

https://www.benefitscanada.com/benefits/health-wellness/hybrid-work-four-day-workweek-shaping-employee-well-being-expert/

https://www.benefitscanada.com/benefits/health-wellness/2022-healthy-outcomes-conference-centering-employee-well-being-in-return-to-office-plans/

 

Flexibility in Benefits:

One size fits all? Not when it comes to employee benefits. – Latest News from Immix Group

Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

Check to Ensure your Benefits Quote is Actually for a Comparable Plan

Posted on by Immix Group

5 Key Areas to Check to Ensure your Benefits Quote is Actually for a Comparable Plan

Inflation is on everyone’s mind; wherever you look, prices are rising. Unfortunately, benefit plans are not exempt from this. When the cost of dentist visits, medical items and procedures goes up, the result is often higher claims. This can sometimes end up passed along to employers as a renewal rate increase. 

Many of you may be considering getting a quote on your benefits plan or may have already received quotes from alternative providers.  Before you make a decision on moving your program, there are a few key points to check to ensure your quote is not too good to be true.

Is it truly apples-to apples?

Consider this scenario: you’ve been presented with a quote for a benefits plan. You had asked for the quote to be apples-to-apples to your current plan. The good news is the price is significantly cheaper than what you’re paying, and supposedly, the plan designs are equal. But are they?

In our line of work, it’s not uncommon to come across what is positioned as a comparable plan, only to find there are many details that have resulted in the lower price. They can be glossed over in a plan summary, and when the time is not taken to examine every nuance to the coverage, it can leave owners- and their employees- disappointed. There is nothing worse than rolling out a new program only to hear from an employee that their prescription -which was always covered under the old plan- is now excluded.

As we have written about in the past, it’s very common to get discounted pricing from an insurer. In short, the carriers usually need to extend some level of reduced pricing in order to gain your business.

And certainly, there are opportunities for true savings on administration costs.  But discounts aside, and beyond the summary of the coverage, we have compiled a list of specific plan elements to check and compare. 

 

Top 5 things to Review if a Benefits Quote seems Too Good to be True

 

  1. Review the details of the Prescription Drug Plan:

What are the details of the drug plan? Is there a managed drug formulary, excluded drug categories or drug caps? Does the plan mandate generic substitution or not?

A drug formulary is simply a list of the drugs that are covered on the plan. Oftentimes, a drug formulary is designed to exclude certain medication categories (fertility drugs or oral contraceptives are typical examples), in order to cut costs. In some instances, a drug plan may even exclude specialty drugs, the expensive but often lifesaving/ lifestyle saving drugs. While it’s often positioned as a benefit to employers, this could leave your employees with major uncovered drug expenses.

It is important to understand the implications of the drug plan. Generally speaking, a drug plan is a key part of the extended healthcare and is intended be an insurance plan. A plan that covers antibiotics (roughly $10-15) but excludes drugs for MS or Chrohn’s disease ($10K+ per year) is not providing coverage against a financially significant, often unexpected expense. While it’s true that a more open drug plan could mean higher drug claims than under a more restricted, managed formulary, the program’s stop-loss max will typically work to limit the plans exposure to high-cost drugs.

How the program adjudicates brand name versus generic drugs should also be clearly known; it’s standard these days to have generic substitution on a program, but this can work differently depending on the carrier or how the plan is set up (for example, will the plan allow the doctor to indicate ‘no substitution’ and therefore cover the brand name version of a drug?). Differences in this area have cost implications.

Lastly, is the annual limit for prescription drugs ‘unlimited’ or is there a dollar limit? You may be okay with implementing a capped drug plan, but again, you need to understand the details and implications. A qualified and experienced benefits advisor will be knowledgeable on all the above points, and most importantly, should be open and transparent about what you are getting.

Reviewing the health benefits plan
  1. Check the Dollar Maximums and Limits for Key Items:

You may have checked in the plan summary that the coinsurance is the same; 80% on certain lines of coverage, 100% on others. But what are the per item or category maximums?

 

The following are the most common items where benefit maximums may be listed, in the fine print:

      • per visit limit for paramedical services, such as $10 or $25 per visit reimbursement, rather than up to the practitioners reasonable and customary limits (i.e. $100 for massage visit)
      • annual per person dental limits in dollars; is this per level of coverage, or combined?
      • dental procedure limits such as scaling units
      • dental recall limits; is it the standard 6 months or has it been pushed to 9 months or even 12?   
      • eye exam limits; is it set to “reasonable & customary” meaning it will adjust with inflation, or is it a set amount? Is the amount reasonable given the cost in your area?
      • Orthotics, surgical stockings and other medical items
      • and as mentioned, is there an annual drug maximum, vs an ‘unlimited’ drug plan

 

While item reimbursement limits are standard practice, they do vary by carrier and many can be customized in a quote. It is important to understand how this may compare to your current plan, and whether the limits are reasonable, given the overall cost of the item, and the intent of your program.

 

 

  1. Check the Contract Wording and Coverage Details of the Disability Insurance

 

We say it all the time: long term disability coverage is the most important but often the most overlooked part of a benefits plan. This is an area to pay close attention to; in the event of a claim, how the claim is handled depends on the contract that is in place which could greatly impact the plan member, potentially for decades. Things to watch for:

      • What is the definition of disability, in words? How does this compare to your current plan?
      • Are commissions, bonuses and overtime pay or T5 earnings properly addressed? If the contract covers salary only, and this is a small percentage of total compensation for certain people, that could leave them grossly underinsured.
      • Cost of Living Adjustment; is there a COLA clause, or an inflationary adjustment included for the benefits payments? Is this important to you?
      • Is the program set up as taxable or non-taxable (is the employer or the employee paying the premiums?)
      • Is the duration of disability benefits to age 65? While this is the norm, we are seeing a trend towards a 5 or even 2 year benefit duration, to reduce costs. If someone goes on disability, they could be disabled for the duration of their life; an insurance plan that only pays them for a few years may not meet your requirements as an employer.

 

There is no bigger waste of money and potential liability than a disability plan that fails to cover people adequately and accurately; reviewing this area with an expert is crucial.

Reviewing details of a health benefits quote
  1. Check the Termination Ages: How long can people remain on various parts of the plan?

Different benefit lines typically have age-based termination or reduction schedules. For example, many life insurance benefits reduce the coverage by 50% at age 65, and then terminate completely at age 70 or 75. For health and dental, coverage is often in place right to age 75 or even ‘retirement’, meaning there is no actual termination age so long as someone is still actively at work.

We have noticed a trend towards lowering termination age and have seen coverage ending at 65 or even 60! For many employers, this is a big deal and it’s often not highlighted in a summary of benefits as a deviation. It is a good idea to additionally check the travel coverage and ensure this part of the extended health care is retained in alignment with the EHC, if possible.      

  1. Review the Mechanics of the Pricing:

Many people fail to review how the quoted premiums compare to the historical claims, or to do a basic ‘reality check’ on a too-good-to-be-true quote. On a typical experience-rated program, the premiums must be adequate to pay the claims, with the other pricing factors such as inflation, IBNR and target loss ratio taken into account.

Some questions to ask are: What is the actual discount that the carrier is investing? What is the duration of the rate guarantee?  What will be the process (financially speaking) when the plan is renewed? What is the Target Loss Ratio? If the plan is to be part of a pool, how does it work? Many times, you can find this out and often the carrier will be transparent as to how they plan to recoup any losses. A qualified benefits advisor should be able to explain this in detail and understand exactly what the renewal process will look like with a specific provider.  

 

Some plan design differences may be acceptable to you

There are always going to be nuances to carriers that are unique to them, and where they simply won’t directly align with your existing plan. Sometimes this means a slight improvement, and sometimes this could be perceived as a takeaway. At the end of the day, what’s important is that you understand the small deviations and that you are not buying something under misleading or mistaken circumstances.

An experience and qualified benefits advisor will do a detailed analysis

With the help of an experienced benefits advisor who knows the terminology and nuances to a quote and contract, the details can be understood. You may review any differences and be totally fine with the program not providing the same level of coverage. The key is to be aware, understand any implications, make an informed decision, and communicate any changes to your staff.

At the Immix Group, our benefits experts can help you obtain a quote, understand the quote and what it means for the future, and manage not only the onboarding of your new program, but the ongoing plan management. 

As always, feel free to reach out to us. We love to hear from you!  

Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

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Business Owners: How to Design the Best Group Savings Plan for your Company

Posted on by Immix Group

By Lindsay Byrka | BA, BEd, CFP
Vice President, Immix Group: An Employee Benefits Company

 

You’ve made the decision to implement a group savings plan for your team. You’ve worked it into the budget, and you know this is something you want to roll out sooner rather than later. Fantastic!
But what’s next?

What should you be considering to ensure the right plan for your group?

The good news is that as employee benefits consultants, designing, implementing and managing group savings plans is part of what we do. We can guide you through all the important considerations, and ensure you understand the options available to you. Most importantly, we’ll make it simple when it comes to implementing the plan and educating your team. Lastly, we make sure the plan continues to run smoothly and is kept up-to-date.

But first, when it comes to making sure you get it right, we have outlined the major considerations in putting together the right group savings plan.

 

Think it through: why are you doing this?

If you haven’t already, take a moment to stop and think as to the purpose of the plan. Is it just the next step in the development of a more comprehensive benefits offering? Are you trying to solve a specific challenge? Is it to replace a different compensation model?

The answers to these questions will inform how you structure the plan, because as with any benefits program, you have a lot of flexibility in how it is designed.

 

Should the plan offering be different, for different types of employees?

How does it fit into your overall company philosophy on benefits and compensation? Is everyone provided the exact same dollar amount of employer contribution, regardless of position or years of service? Or, is a model that provides increasing rewards over time more aligned with your philosophy? What are you doing in other areas of benefits? What is the demographic of your employees; what are their various needs and wants?

 

The right program should consider the characteristics that define your organization.

A group savings program, just like your group health benefits plan should be thoughtfully designed and implemented to ‘feel’ like your business.  It should be designed to provide solutions to the challenges your business faces, such a retaining skilled employees over the long-term, or attracting these people from other businesses.

These facts matter, and this should all be thoroughly discussed with your benefits consultants.

 

Structure of the plan

Pension, Registered Retirement Savings Plan, Tax Free Savings Account or Deferred Profit Sharing Plan? Where to begin? The good news is, we can walk you through the various pros and cons and differing features of the many types of groups savings programs.

All group savings plans are not taxed equally, and all program types do not provide the employer and employees the same features. For example, a Deferred Profit Sharing Plan (DPSP) allows for ‘vesting’ or rather, for employer contributions to remain under the ownership of the employer, until a certain time period has passed for the employee (up to 2 years). This can be a key feature of a program and can assist a business that is facing a challenge such as higher than desired turnover.

Pensions, in contrast to other programs, have a lot more rules attached to them and can be more complex to administer. But, based on your goals, this may still be the right choice.

 

Tax considerations matter too

Tax considerations are also paramount to the correct set-up of a group savings plan from both an employee and employer perspective. Contributions by an employer to a RRSP for an employee are a taxable benefit, whereas if these same employer contributions are made to a DPSP, they are tax deductible to the business, and not a taxable benefit to the employee. This is a major advantage and why many programs are set up as a RRSP-DPSP hybrid.  Getting the right program or combination of programs is essential in ensuring optimal tax efficiency.

group savings2

 

Select the right carrier for you

As employee benefits consultants, it’s our job to know what’s going on in the marketplace, and the various strengths and weaknesses of the various group savings plan providers.

 

Simple administration for both the employer and employee

The right carrier will ensure administration is seamless, integrates with your payroll system and provides both online and mobile options for employees. Is it important for you that employees can self-enroll online? This can be arranged.

For ongoing management, what is your preference for remittances? Most carriers offer many choices.

 

Current technology is key

These days, efficient, current and intuitive technology is absolutely essential and is typically near the top of the list of criteria in a recommended provider. Some carrier stand out in this area, while others have lagged behind, creating frustrations for plan sponsors and members. It is important to know who is getting it right and what they can offer.

 

But old-fashioned personal service matters just as much!

Prefer to talk to a real person? More traditional factors also matter such as local on-demand service support, call centre support and in-person education and training capabilities. Brand strength, organizational size and capabilities are also key considerations.
In understanding what matters most to your organization and team members, we can ensure the right fit.

 

Investment Menu Decisions

Regardless of the provider, a decision will need to be made as to the scope of the funds available. Is it important to you to have the largest selection of funds possible, or would you rather have a narrower range of choice? Providing choices does matter, but not so many to be confusing or overwhelming. We can help you to find the right balance for your group.

As the plan sponsor, you will also need to determine a default fund for those who opt out of making their own investment decisions.

Overall, the fund line up should provide access to the top brands, portfolio managers, and funds so employees will be comfortable investing. It is also important to include target date and target risk funds help make it simple for people to make investment decisions.

Another consideration is the inclusion of socially responsible funds; is this important to you or to your employees? This is a growing request and is certainly available through most providers.  

Luckily for Immix Group, our sister company Ciccone McKay Financial Group employs financial analysts that we engage to help in portfolio selection. This means ensuring your offering to your team meets every mark.

 

And finally, the cost considerations

group savings3


Low fees matter to everyone

Is it important to you that the plan is priced better than retail investing? It should be! These days, people are paying more attention to fees than ever before. The fees attached to the investment funds (the MERs, or management expense ratios) should be lower than retail for the same managed funds. One of the main purposes of a group savings program is to provide bulk buying power for this aspect of one’s financial life (investing) so providing competitive fees is key to ensuring participation in the program.

It’s worth noting that you should typically see few or no charges to the employer.

 

An Employer contribution

What’s in your budget when it comes to the employer contribution? While it’s technically optional, to make a plan really take off, an employer contribution is the cornerstone of a good plan. Even the smallest of employer contributions are ‘free money’ and extremely valued by employees. Somewhere in the neighbourhood of 3-6% of salary is a great starting point.

But, there are many different ways to structure the match, including a flat monthly or annual dollar amount. We can help you work out a structure that fits your budget. And remember- for most plans you can change this at any time.

 

Education for employees, from the right people

group savings4

So you’ve figure out all the details, and you’re ready to get things going. But there is one crucial aspect to work out: a great plan is not a great plan if you fail to effectively communicate with your employees!

 What’s the best way to relay important information to your staff? Is it an in-person session?  A live webinar? An emailed presentation?  What should be covered and in what level of detail?

It is critical to ensure employees receive basic financial literacy training, in addition to education specific to the parameters and operation of the plan. How can they make informed decisions if they have no idea what this stuff is all about? Our team understands how to communicate the details to your staff. Ensuring everyone gets the attention they need is our primary concern.

So, if you’ve made the decision to put in place a plan, it’s time to reach out! We’d love to hear from you to get started. The experts at the Immix Group can be reached at 604-688-5559 or online at info@immixgroup.ca. Or reach out directly to Lindsay at lindsay@immigroup.ca

Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

Market Update: Stay Calm, Stay the Course

Posted on by Immix Group

By Anthony Ciccone, President

A message from Anthony Ciccone, President


Many of you are feeling concerned about the unprecedented events we are experiencing, and specifically, the severe impact on the financial markets. Three months ago, no one knew what COVID-19 was; now it is impacting everyone. This is uncomfortable; we are all feeling the angst. The ups and downs of the stock market over the last few months are a great reminder as to why being well-prepared is essential.

Perspective is vital in times like this. Throughout history, there have been dramatic upswings and downswings; but it also leads to lessons on what we should do and not do, when it comes to our investments. Here are three things everyone must think about. 

 

  1. Context is key. Over the past decade, the S&P 500 has averaged an annual return of 13.8%. The S&P 500 is now giving up years of returns, and it feels scary. What we can control is our own actions. Everything else is out of our control. The best thing to do is be well informed, have patience, and trust the process of your plan.
  2. Please stay invested. Over the past 11 years, we have seen very little volatility. The start of this extreme volatility, which started around one month ago, was only the 6th real drop in 11 years. Before this, the most significant drawdown was in 2018 (20%). Corrections are typical market behaviour. Being comfortable with market fluctuations is important as you should not be chased from the stock market, especially if you have a long-time horizon. 
  3. Diversification. We are exiting a cycle of low volatility, scarce drawdowns and high investor complacency. Many people, wanting to take advantage of the extended period of growth, didn’t see the purpose in owning bonds or negatively correlated assets. March 2020 has shown us the timeless lesson of diversification. There should always be investments in a portfolio that are designed to help when markets don’t go the way that is expected. Losing less right now means recovery is quicker once the markets turn around.

 

Risk makes everyone nervous, but it is also where the return comes from. As it works against our investments, as we see now, it can be abrupt and scary. True wealth is built by being disciplined in our plan and investments. 

Staying true to your plan, staying invested and staying diversified will be the most opportune way to weather the coming storms and capitalize on gains once the recovery emerges. 

If you’d like to discuss your account one-on-one, please feel free to call us at 604-688-5559.

anthony ciccone

Anthony Ciccone

President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O 604-688-5262 E anthony@immixgroup.ca
W www.immixgroup.ca

EAPs – how these programs can benefit both employees and organizations

Posted on by Immix Group

By Lindsay Byrka, Vice President, Immix Group: An Employee Benefits Company

 

You may be familiar with the acronyms “EAP” or even “EFAP.” Perhaps you have a general or at least vague idea about these plans. But, like many people, you’re not exactly sure what they mean or how they work. Lacking a solid understanding, you aren’t sure if providing an EAP or EFAP would hold true value for your team.

Whether you’re an HR professional, a program’s plan administrator or an employee who is a member of a benefits program, it’s to your advantage to know about EAPs. In this article we will try to answer the most common questions about them.

Firstly, EAP stands for Employee Assistance Program. Lately providers have started referring to it as EFAP, for Employee and Family Assistance Program. For the sake of simplicity, we’ll use EAP here.

EAPs originated in the 1970s. They developed out of programs that assisted employees with alcohol problems. The first EAPs included mental health and family problems, keeping addiction still as a central tenet. Today, the scope of these programs is vast, with mental wellness as their guiding principle.

The purpose of these programs is to provide access to support and resolution for problems that are affecting work. However, such problems don’t necessarily have to stem from the workplace. In fact, it’s just as likely that they don’t.

 

What services does an EAP include?

An EAP covers voluntary, free and confidential assessments, short-term counselling (via online, telephone or limited in-person contact), referrals and follow-up services.

The personal and work-related problems may include (but are not absolutely limited to):

  •  interpersonal relationship problems
  •  parenting issues
  •  eldercare issues
  •  drug and alcohol/addiction issues
  •  financial concerns such as debt management
  •  basic legal assistance
  •  general anxiety, stress and coping skills
  •  grief and bereavement
  •  weight management and nutrition
  •  critical-incidence response.


Taking it further, most major EAP providers also offer organization wellness initiatives. While these services are typically included in more robust, stand-alone plans (as opposed to the type of EAP embedded within an extended health-care offering), the services can often still be accessed if required, for a fee.

For companies with comprehensive programs, the organization wellness programs provide education, motivation and intervention in various areas, including:

  •  managing workplace bullying
  •  employee diversity training
  •  harassment prevention
  •  stigma reduction strategies
  •  crisis management
  •  effective communication strategies
  •  workplace issues interventions
  •  customized coaching and assessment
  •  disability prevention, including trauma/depression/anxiety/addiction care
  •  onsite workplace trauma response and follow-up support, e.g., for post-traumatic stress disorder (PTSD).


Most providers are available 24-7, 365 days per year, in a variety of languages, and can give support via a multitude of media.

 

How does an EAP work? Is it really confidential?

Plan members are often concerned about privacy. According to the most recent study by the global healthcare leader Sanofli, only 65% of employees are confident their privacy will be protected. Their fears are understandable – but don’t reflect reality. Being key to the success of these programs, confidentiality is respected and staunchly upheld.

Generally speaking, the providers of EAPs are barred from reporting any details to employer or benefits advisors. They may share a limited amount of aggregate data to assess the usage of the program. But confidentiality as to who specifically is using the plan, and for what issues, is maintained as paramount to the process.

In fact, a lot of the time assistance can be accessed without providing full details as to the identity of the person accessing the service. A simple policy number is often enough.

 

How much does an EAP cost?

The good news is that many insurance carriers include employee assistance programs as an embedded plan feature within the extended health benefit.

Typically, the embedded programs are more limited in scope than a stand-alone program. However, as mentioned earlier, for very reasonable fees you can often purchase one-off services when the need arises. And typically an hourly rate would apply, varying based on the specialist you required.

For a stand-alone plan, the cost tends to be charged as a fee per certificate (meaning, covering the employee and all their dependents) per month. The costs range from around $3-$6 per employee, per month. That’s just $36-$72 per employee per year!

It’s worth noting that, according to industry information on EAPs’ return on investment, for every $1 put into EAPs, the return is eight times over.

The bottom line? This is quite simply a very affordable and valued benefit.

 

Can you expand on the benefit of offering an EAP to employees?

The goal of an EAP is to help employees to get better, and/or to address the problems that are preventing them from doing their best work.

Even large organizations with specialized staff do not have everyone in-house to adequately address the unique situations that may arise in the course of life and business. At an organizational level, implementing an EAP or expanding your program means being prepared to engage specialized professionals when needed. For the employee, this means having the right person for the problem, right at their fingertips.

The benefits are limitless when it comes to the person’s personal well-being. When we’re talking specifically about the impact as it relates to work, here are a few specific goals:

  •  improved productivity – distraction by personal problems has a major impact on job performance
  •  reduce absenteeism
  •  reduce healthcare costs/gradually see lower usage of the plan
  •  prevent escalation of issue involved.


There is a very obvious trickledown effect. Improved employee wellness fosters a positive work environment, which helps to retain employees. The fact is: People stay at jobs because of good relationships with their managers and coworkers.

By assisting your team in achieving personal well-being, you’re positively impacting everyone.

 

Why should I implement this for my employees? Can’t they get help on their own?

Even the best-equipped among us often find ourselves without a clear path or answers to our quandaries. For many, an EAP may be the only thing available to help. Not implementing an EAP assumes employees have their own resources, networks and the knowledge to seek out appropriate care and guidance for either crisis or non-crisis situations that may arise in their lives.

 

We have a plan. Now what?

Awareness is key. Unfortunately, awareness when it comes to benefits is statistically low. Study after study tells us that there is a low level of awareness on the part of both benefit plan administrators and employees with regard to the benefits available to them – and how these benefits actually work.

Even when efforts are made to communicate the details of benefits programs, there is a disconnect. Over 90% of the time, employers report thinking communication was “good or very good.” Unfortunately, most employees totally disagree (Sanofi study).

So, what can an employer do? Here are some suggestions:

  •  Heighten awareness: constant reminders are needed, in a variety of formats
  •  Be clear about the scope of the areas the program addresses
  •  Be clear about the many ways to access it – even better, demonstrate if possible
  •  Reiterate the confidentiality of the plan.

 

While an EAP is just part of an overall strategy to address workplace wellness, it can play an integral role in assisting employers to foster positive mental-health strategies in that workplace.
If you don’t have an EAP in place, we can help. The consultants at the Immix Group can assist you in determining a program that addresses the needs and goals of your organization – while still fitting your budget.

 
 
 

For more information, please feel welcome to contact me: lindsay@immixgroup.ca

Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

This might just be the right time for you to implement an employee group savings plan – here’s why and how

Posted on by Immix Group

By Lindsay Byrka, Vice President, Immix Group: An Employee Benefits Company

 

With RRSP season winding up – the deadline for 2019 RRSP contributions is March 2 – you may be debating if now is the time to implement a group savings plan for your team.

In working with our clients to implement and manage group savings plans, we come across a number of questions and misconceptions. For example, a common incorrect assumption is that implementing a plan will be costly or difficult.

In this article, we’ll try to give you clarification around the why and how of these plans.

 

First of all, what do we even mean by a group savings plan? Is this a pension?

While you may think of an employer-sponsored plan as a pension, these days a Registered Pension Plan (RPP) is less common than other types of employer-sponsored savings programs. We can certainly still offer pension plans, but we are finding that most employers now choose other options.

When we talk about a group savings program, we typically mean a group Registered Retirement Savings Plan (RRSP), often offered in combination with a Deferred Profit Sharing Program (DPSP) and Tax-Free Savings Account (TFSA) option. This is the typical composition of most programs we set up for our clients.

While the above may seem like a lot of acronyms all at once, they’re much less complicated than you may fear.*

 

Six reasons you should consider implementing a group savings program:

  1. It’s cost-effective. Generally speaking, other than a very small amount of administration time, the only cost to you as the employer is whatever you decide to contribute to your employees. If it’s just not in the budget, you can still set up a plan that is for voluntary employee contributions only.
  2. It’s part of a comprehensive benefits offering. If you’ve already implemented a comprehensive health benefits program, and you’re paying competitive salaries within your industry and for your location, the next step is implementing a group savings program.
  3. It gives your company a competitive edge. Despite the process being simple and easy, most employers are not providing their teams with the opportunity to join an employer-sponsored group savings program such as a group RRSP, TFSA or DPSP. These employers aren’t taking advantage of this very simple, very meaningful way to help reward employees and cement their loyalty. Implementing a plan makes your company stand out- in a good way.
  4. Help your team to succeed. Saving money is hard, and it’s stressful. Show your employees that you care about them and their future. Help them to save for their goals, whether it’s for a down payment or for retirement. Just as with employee health insurance plans, your team will truly appreciate a group savings program. These plans are highly valued, far beyond the dollar equivalent in a salary raise.
  5. It’s tax-effective. Properly set up, a group savings plan provides tax advantages to both the employer (contributions can be tax-deductible to the business) and the employee (reduced income tax payable). Employees are often surprised to learn they can reduce their income taxes through a payroll deduction to a group savings plan.
  6. It’s incredibly easy. We promise: This is one of the simplest programs to both implement and manage. As you’re required to be hands-off in many respects (for example, you cannot provide investment advice to employees), you are really just facilitating access for your employees. Our team of advisors at the Immix Group can handle the details, along with your chosen investment provider.

 

Is my company large enough to offer a group savings program?

Most likely, yes. A common misconception is that a small or mid-sized company is not large enough. However, you do not need to be a large organization to offer a group savings program such as a group RRSP, TFSA or DPSP. With just a handful of employees, you can implement a plan that is competitive with those of much larger employers.

 

Is there a lot of administration or complicated paperwork involved?

No. Set-up is simple, and the majority of that set-up is done by our office of benefits advisors and the carrier with whom we decide to provide the group savings program platform. With today’s technology, the systems (online and mobile) available to small and medium organizations are very impressive. These systems offer employees real-time access to managing and tracking their financial and retirement planning. Administration by employers is simple and is basically limited to enrolment and termination of members, and remittance of contributions to the carrier.

 

Are there hidden costs such fees charged by the investment carrier or the advisor?

No. The fees are taken off the investment returns prior to being distributed to the members of the plan. For example, if an investment had a return of 10%, and the investment management fee were 1%, the employee would simply see a 9% return.

While there can be some small one-off charges, these are uncommon and for unique, infrequent situations. In the typical day-to-day administration of the plan, the employer and employee would not be subject to admin fees or service charges.

 

How do I take the next step, and implement a plan?

Enlisting a benefits consultant such as one of the advisors at the Immix Group is the first step in setting up a group savings program. We can walk you through several steps:

  •  Outlining a variety of options that fit your budget
  •  Ensuring you understand the various tax details that are relevant to you
  •  Helping you in selecting the right plan
  •  Rolling it out to your staff
  •  Ensuring education opportunities for staff, both as a group and individually
  •  Managing it going forward.

 

When it comes to a group savings program, set yourself apart as an employer: Offer your people the opportunity to save for their futures. As noted earlier, it’s easy – we promise!

 

For more information, please feel welcome to contact me: lindsay@immixgroup.ca


*Group RRSP: a Registered Retirement Savings Plan. Just like the individual one you may have, but sponsored by your employer, and with contributions made via payroll deduction. A RRSP allows for tax-deferred investment growth.
Group TFSA: A Tax-Free Savings Account; just like the group RRSP, a Group TFSA is simply a TFSA sponsored by your employer. This allows for tax-free investment growth.
DPSP: a Deferred Profit Sharing Plan. This is for the employers’ contributions, and also offers tax-deferred growth on investments, similar to a RRSP.

Lindsay Byrka

Lindsay Byrka BA, BEd, CFP

Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O  604-688-5262 

E lindsay@immixgroup.ca
W www.immixgroup.ca

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