The appearance of misrepresentation of employee benefit coverage can create liability in situations where an employer is perceived as misrepresenting the nature of benefits. In addition, administrative errors leading to a failure to pay disability or death benefits, pensions, or overtime earned may result in human rights complaints, reputational harm, and class action lawsuits. Errors arising from these actions can be minimized by ensuring transparent communications are maintained between all parties. Changes, such as, listed employee beneficiaries, benefits coverage plans, or changing benefits providers require strategies that ensure accurate, clear, and concise communication. Mechanisms, such as, regularly scheduled audits should be conducted to help with the early identification of administrative errors.
Adopt standardized processes to support initial and ongoing employee awareness of benefits coverage, available options, and eligibility requirements with contact information for all plan carriers and products.
Adopt audit procedures to ensure the employee’s current deductions, beneficiary changes, salary information, and eligibility are reflected in the employee’s human resource files as well as records on file with the benefit provider.
Implement formal strategies to ensure staff involved in benefit coordination / administration receive adequate and appropriate ongoing training and support.
Additional Considerations
- Examples of key information that should be shared with new hires regarding benefits:
- Description of the nature of any benefits;
- What will happen to benefits in the event of termination, resignation, or retirement;
- That the full terms of the benefit provider policies governing the employee’s entitlement may not be fully described in a summary booklet or statement;
- Requirement to designate a beneficiary;
- Right of the employer to modify or discontinue benefits from time to time in its sole and absolute discretion.
Additional Considerations
- Examples of key elements to consider related to employee terminations and benefits:
- Require terminated employees to sign a release of claims however consult with expert legal counsel before withholding agreed to / required compensation, stipends etc. where the person refuses to sign the release; retain a copy in the employee’s human resource file, and provide a copy to the employee and benefit provider;
- Consider whether long term disability coverage will be extended during the applicable statutory notice period, particularly in cases where the terminated employee is known to have a health issue that could result in a claim for disability benefits or where the circumstances surrounding the termination increase the likelihood of a claim for disability benefits being made by the terminated employee.
Additional Considerations
- Benefit plan coordinators / administrators are accountable to keep employees informed about the details of their benefits plan. To help ensure compliance with applicable legislation and reduce legal liability, learning outcomes for benefit training may include:
- Comprehensive understanding of the employee benefit plan(s) and applicable legislation;
- Comprehensive understanding of the organization’s and benefit provider(s)’s workflows to administer the plan;
- Provision of expert benefits-related advise including (but not limited to) options, timelines, and consequences for late / delayed applications.
Additional Considerations
- Examples of monitoring and measurement strategies:
- Adoption of formal performance metrics and targets;
- Learnings from employee and benefit plan provider feedback (e.g., periodic human resources file audits, medical legal and human right tribunal claims).
