The Leslie Group Ltd. - News

Retirement Compliance

2011-03-08T11:18:41-04:00

It has been almost five years since the Retirement Capital Accumulation Plan (CAP) guidelines were introduced (December 31, 2005) in Canada. These guidelines are designed to ensure that plan members are receiving ongoing education and communication surrounding their retirement plan, and that a reasonable number of investment options are available to allow plan members to build an investment portfolio that meets their risk tolerance and investment objectives. In addition that plan member charges for, administrative, record keeping and investment management fees are fair and competitive.

The Leslie Group is able to assist in ensuring that your Retirement plan (Group Registered Retirement Savings Plan (RRSP), and or Deferred Profit Sharing plan (DPSP) and or Registered Pension plan (RPP) meets or exceeds these guidelines. Attached is a summary of the CAP guidelines.

The Leslie Group currently manages over $200 million dollars in defined contribution group plan assets for our clients and has the expertise and experience to assist your team and plan members. Typically we are able to assist your corporation in meeting the CAP guideline requirements at no additional cost to your organization. Unfortunately many programs offered today are not complying with these requirements and are opening their organization up to potential liability and litigation.
Please contact The Leslie Group at (416) 510-8966 to illustrate how we can assist you.

Preferred Pharmacy Program

2010-12-22T13:32:34-04:00

The Leslie Group is pleased to offer our clients a preferred pharmacy dispensing fee program that will assist in reducing and containing rising prescription drug costs while not reducing the coverage for plan members. The average total prescription drug cost is approximately $60.00 per prescription and rising. The dispensing fee typically ranges in cost from $9.99 to $12.99 per prescription in Ontario (dispensing fees vary by province) and $7.99 and $9.99 in most other provinces. The average dispensing fee currently represents 16% to 22% of the average cost of prescription drugs.

Our preferred dispensing fee arrangement currently offers a preferred rate of $8.00 in Ontario and $5.99 in Manitoba, Saskatchewan and the Maritimes (varies by province). In British Columbia and Alberta everyday best pricing is provided. This as an example is a reduction from the Ontario average dispensing fee charged of $10.50 by 23.91% and reduces the average total prescription drug costs by approximately 4.19%.

Our voluntary preferred pharmacy arrangement is available across Canada at no cost to our clients with the exception of Quebec. Unfortunately Quebec does not separate the cost of the dispensing fee which eliminates this opportunity. Our network with the Loblaws group of companies offer over 500 convenient locations across Canada (see website www.drugstorepharmacy.ca for locations of pharmacies).

The Leslie Group is able to structure your pay direct prescription drug card program to include a dispensing fee maximum that typically will immediately reduce your prescription drug plan costs by approximately 5%, while providing a voluntary option for the majority of the plan members to purchase prescriptions at a convenient location (Grocery Store) with no negative cost impact for members. With drug plan costs typically representing one of the higher benefit costs to a group insurance program. The question is; can you afford to not take advantage of this cost containment option available from The Leslie Group Limited?

The Leslie Group is a full service benefits consulting firm that is, in keeping with market conditions and legislative changes, committed to providing you with the best advice needed to manage your group benefits program. We would be pleased to address any questions and can be reached at (416) 510- 8966.

The End of Mandatory Retirement

2010-11-10T10:04:43-04:00

Originally pubslished on :
http://www.ohrc.on.ca/en/resources/factsheets/endmandatoryretirement

As of December 12, 2006, the Ontario Human Rights Code protects all persons aged 18 and over against discrimination in employment on the basis of their age. This means that employers cannot make decisions about hiring, promotion, training opportunities, or termination on the basis of an employee’s age.

Prior to this date, the Code did not prohibit age discrimination in employment against persons aged 65 or older. As a result, policies requiring mandatory retirement at age 65 could not be challenged under the Code . This is now no longer the case. Persons aged 65 and older who believe that they have been discriminated against on the basis of age, including through mandatory retirement policies, may file a complaint of discrimination on the basis of age with the Ontario Human Rights Commission.

This does not mean that employers cannot have retirement programs based on a certain age. Rather, it means that such programs cannot be mandatory, except for judges, masters, and justices of the peace under the Courts of Justice Act , for whom there is a specific exemption under the Code.

In some rare cases, employers may be able to defend mandatory retirement programs on the basis that they are bona fide occupational requirements. In order to meet this test, employers must show that their mandatory retirement program was developed in good faith, is rationally connected to the nature of the work, and that it would be impossible to develop a non-discriminatory program without undue costs or health and safety risks. For example, an employer would be required to show that the objectives of its mandatory retirement program could not be achieved through individual testing and assessment of employees.

Except in circumstances where mandatory retirement can be shown to be a bona fide occupational requirement, collective agreements that contain such provisions will be unenforceable.

It should be noted that the provision of medical, dental, disability and insurance benefits to employees aged 65 and older will remain at the discretion of employers. Exemptions in the Code and the Employment Standards Act and Regulations mean that differential provision of benefits to employees aged 65 and older is not subject to human rights challenges. Similarly, age-based distinctions under the Workplace Safety and Insurance Act are shielded from scrutiny under the Code .

Arbitrator upholds statutory provisions permitting age-based distinctions in benefits for employees aged 65 and older

2010-11-10T10:03:09-04:00

By Barry Brown and Aida Gatfield

Download the original article here

On October 31, 2010, Arbitrator Etherington issued a significant award on the interpretation of the provisions of the Ontario Human Rights Code (the “Code”) and the Employment Standards Act, 2000 (the “ESA, 2000”), which effectively permit an employer to reduce or eliminate employee benefits once an employee reaches age 65. Arbitrator Etherington found that while the provisions violate the section 15 equality rights of the Canadian Charter of Rights and Freedoms (the “Charter”), they are a reasonable limit on those rights and are therefore constitutional.

This FTR Now discusses this award and its implications for employers.

BACKGROUND

Historically, the Code prohibited discrimination in employment on the basis of age, which was defined for employment purposes as “an age that is eighteen years or more and less than sixty-five years.” In 2006, the Code was amended to remove the upper limit of age 65, thus extending the protections of the Code to all employees aged 18 years or older. One of the key consequences of the amendments was the end of mandatory retirement in virtually all Ontario workplaces.

Although the 2006 amendments extended the Code’s protections to employees over the age of 65, the Code was also amended to permit employers to differentiate on the basis of age in employee benefits plans, as long as the plans complied with the ESA, 2000 and its regulations. Because the ESA, 2000 only prohibits age distinctions for employees below the age of 65, the effect is to continue to permit employers to make age-based distinctions, such as the level of benefits they provide or whether benefits will be provided at all, with respect to employees 65 years of age or older.

Following the changes to the Code, the Municipality of Chatham-Kent and the Ontario Nurses Association (“ONA”) negotiated a collective agreement that provided for reduced levels of benefits for employees aged 65 or older, and provided for no LTD or AD&D coverage for these employees. Despite having negotiated the provisions in question, ONA subsequently challenged the collective agreement provisions, and the constitutionality of the Code itself.

THE AWARD

In Ontario Nurses’ Association and Municipality of Chatham-Kent (31 October 2010, Etherington), ONA complained that the collective agreement was unlawful because it provided a reduced benefit package for employees over age 65. ONA alleged that the collective agreement violated the Code and the prohibition against age discrimination in section 15 of the Charter. More importantly, ONA also alleged that the Code itself was unconstitutional because its provisions with respect to benefit plans were contrary to section 15 of the Charter.

In his award, Arbitrator Etherington held that the relevant provisions of the collective agreement and of the Code do violate section 15 of the Charter. He concluded that the distinctions they draw between workers under age 65 and those over that age constitute discrimination based on age.

However, he went on to find that the impugned provisions constitute a reasonable limit on the equality rights of the Charter and, therefore, are “saved” by section 1. He found that, although not a perfect solution, the government's decision to allow employers and employees to retain their current benefit plans and to preserve their ability to negotiate plans best suited to their workplace was a reasonable approach to the impact that the elimination of mandatory retirement would otherwise have on a wide variety of benefit plans developed prior to the change.

In coming to this conclusion, he noted that the choice of any age limit always involves a degree of arbitrariness, stating that “there may be a range of acceptable alternatives available to government to select, but…they must inevitably engage in some line drawing and decide on which is the preferable limitation from a social policy perspective given the need to balance the interests of the individual with the collective interests at stake.”

He also found that the impugned legislation left “employers, employees and unions with the flexibility to negotiate whatever terms and conditions of employment they feel the market warrants or requires to meet their particular needs in terms of recruitment, retention or continued employment. It does not mandate lesser benefits or insurance plan coverage for senior workers but leaves it to the parties to bargain to arrive at the coverage that best meets their circumstances.”

Having concluded that the Code provisions were valid, the Arbitrator then held that their plain and ordinary meaning allowed the kind of distinction in benefit plans negotiated by these parties and, therefore, the collective agreement did not violate the Code.

IMPLICATIONS FOR EMPLOYERS

Although the award is binding only on the parties involved, other arbitrators will likely find Arbitrator Etherington’s detailed factual and legal analysis very persuasive. This is good news for employers. Most benefit plans were negotiated or developed when all employees retired at age 65. Consequently, many plans do not offer benefits beyond that age. With the abolition of mandatory retirement, employers have had to confront the question, given the increased cost and limited availability of benefits for older employees, whether they can provide a different package of benefits to those employees who stay on past 65. Unless overturned by the courts, this award affirms that such distinctions are lawful in Ontario.

The case was successfully argued on behalf of the employer by Barry Brown of Hicks Morley’s London office. If you have any questions about this award, please contact Barry Brown at 519.931.5602, Aida Gatfield at 519.931.5605 or your regular Hicks Morley lawyer.

The articles in this Client Update provide general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Hicks Morley Hamilton Stewart Storie LLP and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Hicks Morley Hamilton Stewart Storie LLP. ©