New Report: Impact of COVID-19 on Pensions and Benefits in Canada
New Report: Impact of COVID-19 on Pensions and Benefits in Canada

The COVID-19 pandemic has had significant implications for workplaces across the world, and employers and workers have needed to make difficult decisions regarding retirement, health and paid leave benefits. A new International Foundation report, Impact of COVID-19 on Pensions and Benefits in Canada: Spring 2021 Update, addresses these changes and provides a snapshot of the current environment.

Today's Legal & Legislative Landscape Across Canada

Impact of COVID-19 on Pensions and Benefits in Canada key findings include:

Managing a Remote Workforce

Canadian employers report that before the pandemic, on average, 14% of their workforce worked remotely, compared with almost half (49%) who are working remotely now during the pandemic. This shift has resulted in just under half of employers (46%) reimbursing their workers for specific work-from-home expenses, while 6% of employers are offering a general stipend that covers a wide range of expenses. Of organizations that are providing reimbursements during the pandemic, employers are most commonly reimbursing for office supplies (49%), office furniture (32%), electronic devices (24%) and internet service (22%).

Mental and Behavioural Health Benefits

Organizations that offer mental health benefits to their workers have made several shifts due to the pandemic, including the following.

  • Allowing telemedicine or virtual health for mental health benefits. In June 2020, 10% of employers had added this benefit due to the pandemic, and by February 2021, 23% of employers had allowed for virtual health for mental health issues. (This is in addition to the 47% who were already offering prepandemic.)
  • Relaxing or eliminating the eligibility requirements for mental health benefits (7%)
  • Reducing or eliminating cost sharing for mental health benefits (7%)

Additionally, more than two in five organizations (41%) are adding services to their mental health benefits.

Changes Made to Mental Health Benefits Due to COVID-19 Pandemic

Employee Assistance Programs (EAPs)/ Employee and Family Assistance Programs (EFAPs)

Of employers that offer an EAP or EFAP, 61% cite an increase in the utilization of plan services as a result of the COVID-19 pandemic. The average utilization rate of EAP/EFAP services before the COVID-19 pandemic was 9%, and it has now increased to 15%.

Prescription Drug Benefits

Of organizations that offer coverage for prescription drugs, about one in five (18%) have extended the time allowed under prior authorization periods, followed closely by temporarily waiving premiums for some or all plan members (17%).

Defined Contribution (DC) Plans

Of employers offering DC plan withdrawals, 21% report an increase in withdrawals, up substantially from the 8% increase observed in June 2020. Changes in DC contribution levels vary with 65% of employers reporting no changes to contribution levels, 5% reporting a greater number of changes and 5% reporting a smaller number of changes.

Defined Benefit (DB) and Target Benefit (TB) Pension Plans

For organizations offering a DB or TB pension plan, 27% have reviewed actuarial assumptions/pension plan designs, with an additional 28% considering doing so. One-quarter (25%) of responding DB plans have updated their investment policies, and an additional 23% are considering doing so. Both actions represent substantial increases from June 2020, when 11% had reviewed their actuarial assumptions/pension plan designs, and 6% had updated their investment policies.

Learn More

Impact of COVID-19 on Pensions and Benefits in Canada: Spring 2021 Update addresses changes to DB and DC plans, health benefits, EAPs/EFAPs and workforce staffing levels. It is a follow-up survey to a report conducted in June 2020 by the International Foundation. The full report is available free to members here.

[Upcoming Webcast: Canadian Drug Landscape Update – Sponsored by Canada Life | May 18, 2021 | Register Now]

Brenda Hofmann
Communications Manager at the International Foundation

Today's Legal & Legislative Landscape Across Canada

The latest from Word on Benefits:

Staff

Communications Manager at the International Foundation

Favorite Foundation Product: The Word on Benefits Blog

Benefits-Related Topics That Grab Her Attention: Wellness, work/life balance, retirement security, parental leave policies and unique and trending perks.​

Favorite Foundation Event:The day we wait all year forNational Employee Benefits Day!

Personal Insight: Brenda goes with the flow and this approach to life puts everyone around her at ease. Brenda enjoys the mix of roles she plays from communications pro to mom and wife.

Recommended Posts