The Personal Benefit Program™

. . . protecting the employer while serving the employee

We created The Personal BeneFit Program™ as a strategy to create knowledgeable employees.  It’s more than a hand booklet, it’s a high level of service.

The goal of our program is to educate employees to become active, competent consumers rather than passive receivers of benefits.  Our communications focus on getting employees to take ownership of their benefits and to use them wisely.

Employment benefits and rewards programs are a common and effective way of recruiting and retaining employees, but employers must be cautious.  There are legal pitfalls that can come up for employers explaining what they offer if an employee doesn’t grasp the details.

The Supreme Court of Canada has said the employment relationship is a “special relationship,” characterized by a power imbalance in which the employer has the upper hand.  Judges have often applied that principle and held employers liable when employees have not fully understood the terms of their benefit programs.  Employer liability has been found even when the employer has given accurate information or urged employees to seek independent advice.  That’s not enough, the judges say, in this “special relationship”. 

One Example 

Lehune v. Kelowna (City).  Here, Lehune, who was about to retire, was provided with inaccurate and incomplete information about his life insurance coverage.

The employer’s labour relations and benefits supervisor told Lehune that his insurance coverage could not be extended beyond his retirement (Lehune was terminally ill at the time with cancer).  In reality, the employer’s insurance policy did extend for 31 days beyond retirement and also had a conversion privilege that would have allowed Lehune to continue the coverage as a separate individual policy.  Again, the failure to properly inform the employee of the true nature of the benefits resulted in liability for the employer. 

GOOD COMMUNICATION PRACTICES 

As with many benefit issues, employers should start off by instituting a good governance framework.  The goal of this framework should be to ensure that the right people are providing the right information at the right time.  Communication practices that should be considered when creating such a framework include: 

1. Have an experienced benefits provider, consultant or lawyer confirm the employee booklet is accurate and discloses all of the options employees should be made aware of.  Date and keep all versions of the booklet on file.  At Gary White Insurance we go to great lengths to make sure this happens.  Our corporate clients give high marks to The Personal Benefit Program™ and agree its unique and holistic approach to communicating benefits has greatly benefited their employees.
2. Create a written list of issue, Q&As and facts communicated to employees at benefits information sessions for existing employees and new employees.  Create a written summary of everything that’s said at benefit lunch-and-learns or similar sessions and keep it on file forever.  Make sure, if there’s ever a lawsuit where an employee complains he didn’t understand the features of a benefit plan, someone from HR can say that even if he doesn’t remember what was specifically said to the employee, every time an employee information session was conducted, everything was communicated and employees were asked if they had any questions.  Ensure every employee understands what’s been communicated at every benefits meeting.
3. Know the benefits service provider is the representative of the employer.  If the provider gives incomplete or inaccurate information to the employees, the employer is legally liable for it.  Be aware if there’s a limit on the provider’s liability to the employer as sometimes there are clauses in the legal contracts saying the service provider’s liability is limited to six months or year’s fees.  Ensure the service provider commits to a high level of service standards in all employee communications.  At Gary White Insurance we are pleased to report that we have never had a corporate client held legally liable for any miscommunication of benefits.
   

As case law in Canada suggests, employers are being held to a demanding standard when communicating with their employees.  It is no longer enough that employers simply disclose information to employees.  Employers must also ensure that such disclosure is done with reasonable care.

Whether you are an employer or an employee, call us today for a complete demonstration of The Personal Benefit Program™.

Gary White Insurance

Tel: (800) 433-5307 Bus. Cell: (416) 768-4279
Email: info@garywhiteinsurance.com