The client is a family-owned Canadian business in the logistics and distribution industry with over 70 employees, from labourers to professionals, key employees, and two generations of owners. From the beginning, it was clear to us that the diverse range of wages and salaries within the company would require a flexible yet innovative approach in creating a successful benefits plan.
The Challenge
The client’s historical “one size fits all” benefits approach no longer worked:
- Employees were demanding access to better benefits.
- The company needed to keep the benefits budget flat.
- Owners and key employee benefits didn’t match the company compensation philosophy.
Our meeting with the owners was a collaborative process that involved combining our expertise with their understanding of their company culture and the needs of their employees.
The Solution
The key to resolving the company’s benefits challenge was through a customized tiered plan structure and a separate executive plan for owners and key employees. We created a tiered structure with four levels: Core Company Plan, Bronze, Silver, and Gold.
- The Core Base Plan is 100% paid for by the employer.
- The Bronze, Silver, and Gold plans are provided so the employees have the choice to pay-up and opt-in to increased levels of coverage.
- Shifts between tiers are permitted annually. Employees are permitted to move up or down one tier per year, which decreases anti-selection.
- For both the owners and key employees, we formulated a unique executive benefits plan that includes 100% coverage with no maximums.
The Result
- The creative benefits plan design helped the company keep their budget flat while providing their entire staff access to basic benefits.
- The tiered opt-in setup gave each individual staff member the freedom to choose the plan that best suits their individual needs on an annual basis.
- This innovative benefits structure also gave both the owners and key employees their own executive benefits that match the company’s compensation philosophy.
How Can The Benefits Trust Help You?
For more than 25 years, The Benefits Trust has helped thousands of Canadian companies provide superior benefits to their well over fifty thousand employees and their families. We work closely with our advisor partners and have longstanding business relationships with more than 20 insurance companies and service providers. Our process helps employers gain complete control over employee benefit costs; maximizes plan design flexibility; and enhances tax-advantaged benefit opportunities for key executives and highly compensated employees.
