Health and dental care insurance offered to employees on extended disability: trends observedLinkedIn
There, in black and white
NB bulletin Vol. 16 N. 10, June 2013
In 2012, we surveyed 90 Quebec and Canadian organizations on practices concerning health and dental care coverage offered to employees on extended disability leave. Below is a summary of the main findings concerning the maintenance or termination of coverage, followed by a comparison of practices against minimum legal requirements.
Maintenance of coverage
The results of our survey show that four out of five organizations maintain health and dental care insurance coverage for employees on extended disability.
For 62% of respondents, organizational values were cited as the main reason for the decision to maintain coverage. Other reasons given include collective agreements (28% of respondents) and the recognition of increased needs for insurance during a disability (17% of respondents).
Although the vast majority of respondents maintain health care and dental care coverage in the event of extended disability, there is no guarantee that this trend will continue because one out of ten organizations plans to introduce termination measures in the next two years.
It should also be noted that close to half of the organizations surveyed require employees on extended disability to pay their normal share of premiums during the period of disability. Interestingly, even though we expect more of the organizations that require disabled employees to continue paying premiums to eventually terminate coverage, no clear correlation was observed.
Termination of coverage
Among the organizations that terminate coverage during extended disability, approximately three out of four organizations terminate the employee’s coverage regardless of the position held, whereas one quarter of the organizations suspend this coverage for certain employee groups only. Management employees appear to be less impacted by this measure than other employee groups.
We tried to establish a link between the size of the organization and the tendency to terminate coverage in the event of extended disability; however, the survey results did not allow us to do so.
The results of our survey allow us to confirm that Quebec and Canadian organizations generally exceed the minimum labour standards set out in relation to the maintenance of coverage during disability leave.
In Quebec, the Act respecting labour standards stipulates that the employment relationship of a salaried employee with at least three months of continuous service cannot be severed due to accident or illness until after the employee has been absent for 26 weeks during a 12-month period. During this period, the employee’s participation in his/her employer’s group benefits plan must be maintained, subject to the payment of his/her share of premiums if required by the employer. The employer must also continue to pay, at least, its normal share.
Also in Quebec, the Act respecting industrial accidents and occupational diseases stipulates that, in organizations with more than 20 employees, an employee is entitled to be reinstated, in priority, in his/her job if he/she becomes able to work again within two years of the start of his/her period of absence. During this two-year period, the employment relationship and benefits must be maintained, and the employer’s level of contribution will be the same as it had been before the disability occurred.
Labour standards are not the only things to consider when it comes time to establish a policy on the termination of coverage in the event of extended disability. Canadian human rights legislation prevents discrimination against disabled persons. Moreover, some employees may also have additional rights outlined in their employment contract.
No matter what decision the organization makes in relation to its policy on the maintenance or termination of coverage, it must apply this policy uniformly to all employees and communicate it clearly, for example, through the employee handbook or collective agreement. Also, when there is a fixed period after which coverage is terminated, the policy should not be systematically applied. According to case law, imminent return to work predictors must be considered.
Please feel free to contact us for additional information.
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