Canadian Employee Benefits Trends in 2021

For collective society, 2020 was, well, kind of a flop. As we roll into the new year, we’ve had time to adjust to life with COVID-19 as an ever-present factor in our lives – and, with a vaccine in sight, a glimpse of hope. Despite everything that’s happened, many of the predicted Canadian employee benefits trends forecasted for 2020 remained true. While 2021 will admittedly be a somewhat unpredictable year in many aspects – public health, the economy, and business growth – below are the top projected employee benefits trends in Canada for 2021.

1. Virtual health, telehealth
2. Mental health
3. Flexible work times/FlexTime
4. Financial wellness
5. Administrative Services Only (ASO)

1. Virtual Health/Telehealth

Virtual health apps such as Akira and Maple have been rising in popularity over the past couple years. With many clinics and other healthcare providers restricting in-person visits due to COVID-19, coupled with public health recommendations for citizens to stay home, more businesses will continue to supplement a digital healthcare strategy to support their employees. 

Maple and Akira have already experienced an unprecedented boom in 2020, which is only expected to continue to spike in 2021. According to BNN Bloomberg, the Canadian telehealth sector has been receiving heavy funding and investment in anticipation for more usage in the near future as more employers start investing in digital health. Still on the fence about whether digital healthcare is right for your company? Read why employers should offer virtual care benefits here. 

2. Mental Health

For many of us, 2021 will continue to be an isolating year; no social circles, no dinners with extended family, no office banter. For many employees, social distancing has taken a mental and emotional toll. According to Global News, almost a quarter of Canadians have reported a decline in mental health since the first wave of the pandemic. Many report isolation to be the biggest contributing factor in their declined emotional and mental health. 

Because of this, we can expect to see an increase in employers offering mental health support for their employees in 2021. Traditionally, this would consist of Employee Assistance Programs, or EAPs for short. EAPs allow employees to be connected to counselling and/or other mental health professionals, in addition to offering assistance for other issues such as financial, family, and even fitness coaching, among many others. 

Modern mental health-specialized startups are also gaining traction in the mental health space. Among them include Inkblot Health and MindBeacon, both of which offer one-on-one digital counselling sessions with certified mental health professionals. These digital mental health aids can be used in the absence of an EAP, or to supplement an existing EAP program. 

3. Flexible Work Times/FlexTime

With many schools and daycares temporarily shutting their doors, working parents of young children have been scrambling to juggle their job and childcare simultaneously.

This year, expect to see more employers offer more flexible working hours for their employees. Those who aren’t directly client-facing or partake in shift work may be offered the option to work outside of traditional 9-5 working hours, either starting early in order to wrap up by the afternoon, or working in the evenings. 

This allows employees who must divide their time between work and personal commitments to do both without sacrificing one for the other. In particular, offering flexible work hours benefit:

• Employees who care for sick family members
• Parents with young children at home
• Employees who share limited working space with roommates/members of their household 
• Employees who wish to work without background distractions 

Giving employees the flexibility to choose their own working hours is a great “soft benefit” that an employer can offer at no monetary cost to the business. It’s a great way to:

• Build employee loyalty and goodwill
• Attract and retain top talent
• Stand out in the employer pool

4. Financial Wellness

With the COVID-19 pandemic leading to mass employee layoffs and cut hours in nearly all sectors, many Canadian households have seen a worrying dip to their finances. 

According to the FP Canada™ 2020 Financial Stress Index, 4 out of 10 Canadians report that the pandemic has affected their financial stress levels, with 1 out of 10 reporting that the pandemic has severely affected their financial stress levels. What’s more, 39% of respondents in the 2020 Sanofi Canada Healthcare Survey reported money problems to be their number one source of stress. 

These statistics point towards an alarming pattern of financial stress among Canadian employees. 2021 is the perfect year for employers to integrate financial wellness into their workplace health strategy if they have not already done so. This may include an Employee Assistance Program (EAP) to help employees access financial planning support, RRSP matching programs, or offering virtual financial literacy education sessions. 

5. Administrative Services Only (ASO)

Under an Administrative Services Only plan, or ASO for short, employers only pay for the actual expenses that employees incur, plus an administrative fee for each claim. This differs from traditional coverage plans that leave employers paying a set premium every month, regardless of actual employee usage. 

With an ASO plan, employers are assuming some of the risks; therefore, they get the savings from a better claims experience instead of passing those savings on to the insurer.

In 2020, Canadian employers as a whole saw lower than expected use of employee coverage in certain areas such as routine dental cleanings and paramedical services (massage therapy, chiropractic services, acupuncture, etc) due to the pandemic. As this pattern is expected to continue into 2021, more employers may benefit from switching to an Administrative Services Only plan to potentially save on insurance premiums. 

Certain employee benefits providers such as Benecaid even offer “Budgeted ASO,” whereby a group can deposit a pre-set amount each month to cover the cost of employee’s claims. If usage is lower than expected, Budgeted ASO plans allow the employer to receive whatever they paid in excess to be returned back to their account at the end of the plan year.

In a time when cash flow may be unpredictable for many small and medium-sized companies, a Budgeted ASO plan serves as an affordable option for many employers.

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