The Importance of Finding a Job with a Good Employee Benefit Plan

Having a high salary is great, but if it doesn’t come with good benefits like health and dental, your actual disposable income may be less than you think. When considering job offers, it’s important to look at the full benefits package that the company offers.

Employee benefits typically cost organizations between 15 and 30 percent of their overall payroll. But these premiums are necessary to attract and retain quality employees. Therefore, it’s important to both the employer and the employee to have well-developed benefit plans.

Employee Benefits Required by Canadian Law

Certain benefits are required by Canadian law – for example, all employers in Ontario must provide the following benefits to their employees:

• Employment Insurance (EI): deducted from employees’ earnings to provide temporary income support to unemployed workers while looking for employment.
• Canada Pension Plan (CPP): provides contributors and their families with partial replacement of earnings in the case of retirement, disability, or death.
• Workplace Safety and Insurance Board: these premiums can vary depending on the employer and the industry, but it goes towards employees that become ill or injured in the workplace.

Optional Employee Benefit Plans

Most optional health insurance benefit plans are administered through a third party. These benefit plans can vary in terms of coverage (entire family or sole employee), contribution amount (cost split between employer vs. employee), and services covered (health, dental, long-term disability, etc.).

Two types of benefit plans that are becoming more popular with employers are:

1. Flexible Benefits Plans: Instead of designing one benefits plan for all employees, flexible benefits are tailored to each employee’s needs. It works by giving a list of benefit options that the employee can use given credits that they allocate – if you choose benefits over and above the credit limit, the employee pays the extra costs.
2. Health Spending Accounts: Similar to the flexible benefit plans, the employee has a credit limit that they can apply to health care expenses, but there may be additional benefits that are covered by the employer. It’s essentially a hybrid between a regular sponsored benefits plan (coverage for all employees) and using a flexible benefits plan.

Coverage for Employer Benefits

Employers can offer many different types of benefit plans; however, it’s important to look at the different coverage options. For example, some plans will cover 100% of the claim, while others may only cover 80%, leaving the remaining 20% as your responsibility to pay.

The different types of coverage usually correlate with different contribution amounts. If you want your claims to be 100% covered, you will most likely pay a premium amount for this type of plan.

Different Types of Employer Benefits

When considering job offers, here are some of the most important benefit options you should look for:

• Extended Health Care: reimbursements for eligible medical expenses, including prescription drugs and hospital care (private rooms, for example).
• Employee Assistance Programs (EAS): EAS provides counselling and advisory services, among others.
• Vision: employer-sponsored vision benefits can provide reimbursements for eye glasses and contacts.
• Dental Care: coverage for preventative and diagnostic dental treatments (e.g. cleanings and cavity fillings) that are not otherwise covered by OHIP.
• Life Insurance: provides additional benefits and monetary pay (sometimes in a lump sum) to the member’s family in the event that the employee accidentally dies.
• Long-Term Disability: an insurance policy that protects an individual’s loss of income in case he or she is unable to work due to illness, injury, or an accident
• Vacation Time: additional paid vacation days (above that required by the Ontario Employment Standards Act)
• Paid Sick Days: most employees have the right to take up to 10 days of job-protected Personal Emergency Leave (PEL) each calendar year; however, only the first 2 days need to be paid by the employer. Some employers may offer additional paid emergency/sick days.
• Group RRSP & Pension Plans: retirement savings plans offered by the employer. A good plan will offer employee-matching (for every x% you contribute, your employer will match x%).
• Education and Training: some employers will offer reimbursement for furthering educations, including certificates, post-secondary education, attending seminars, and more.
• Flexible Work Arrangements: some employers may allow their employees to work from home, change their work hours, etc.
• Other: employers are coming up with so many unique benefits options to attract and retain employees, with things like subsidized lunches, daycare assistance, dog-friendly offices, and more.

Having a good benefits package is important when accepting a job offer, because otherwise you’ll need to pay for a lot of these expenses on your own. But nowadays a good benefits plan goes beyond the basic expenses and includes things like extra vacation, flexible work hours, and catered lunches in the office. When considering job offers, salary isn’t the only thing to look at; you should look at the complete benefits package as well.