Ask the ExpertCategory: QuestionsOrganizational Policy Update Inquire
hri_Admin Staff asked 4 years ago

Hello, I’m reaching out to you to enquire about the rules in updating/changing an organizational policy. Our company is planning to update our organizational policy with regards to employee benefits during legislated leaves (maternity/parental/sick etc.) to specify that the employees will be responsible to satisfy their portion of the health benefit premium during prolonged absence. We are not sure if the new policy can be applied to those of our “on leave” employees who went on their leaves when the old policy was in effect. I would appreciate any suggestion. Best regards  

3 Answers
Glenn Demby Staff answered 4 years ago

Not sure my response went thru, so I’m resending it:
Normally, I would say that applying a leave-related policy change like this to an employee AFTER he/she’s started leave in accordance with the original policy is highly problematic and a potential breach of contract. However, requiring employees to continue participating in benefit plans during leave (and continuing to make employer contributions on his/her behalf) is not only permitted but mandated under the Ontario ESA (Section 51(1)) unless the employee elects in writing not to do so. Accordingly, the rule would apply regardless of what your leave policy says or doesn’t say.
I’m going to run this past our payroll expert for a second, more informed opinion but I personally think you’re OK. However, I would suggest vetting your leave policies to ensure they’re in line with ESA requirements. To be continued. . . Glenn

Jolanta Brzezinska replied 4 years ago

Great, thank you so much for your response and looking forward to hear the payroll’s opinion.

Glenn Demby Staff answered 4 years ago

While not necessarily disagreeing with the substance of my response, my payroll colleague Alan McEwen has a different take on your Q. I agree with what he’s proposing. So I guess consider this 2 answers for the price of 1. 
Sorry, I wouldn’t have answered exactly this way. Under the existing ON ESA, the choice of whether or not benefits continue during legislated leaves lies wholly in the hands of the employee. Benefits must continue unless the employee provides written notice that both:

  • The employee doesn’t want the coverage; and
  • The employee won’t pay for any portion that was otherwise employee paid.

In practice this means where benefit costs are shared between employer and employee, the employer must continue paying the premiums unless the two conditions above are met. A lack of response from an employee, the absence of an agreement to pay these or the failure to actually pay them doesn’t change this liability.
You also have to consider the Human Rights aspect. If the employer wants to stop benefit coverage during legislated leaves, which mostly deal with protected Human Rights grounds, but not for voluntary leaves of absence, then that’s going to be a problem.
My own suggestion is that any employer policy related to benefit costs during legislated leaves deal with the two points above, rather than a blanket cessation of benefit coverage during legislated leaves.
And if the existing policy is to provide benefit coverage during legislated leaves, i.e. a greater benefit than the ESA requires, removing this might be considered constructive dismissal, especially for employees on an existing leave.
Let me know if you’d like to discuss.

Jolanta Brzezinska replied 4 years ago

One more kindly thank you for all your help. Both response were very meaningful and has clarified the matter. It is a great pleasure to be a member of HR Insider knowing that I can count on your expertise and experience.

Glenn Demby Staff answered 4 years ago

Awesome! So glad we could be of assistance and really appreciate your kind words.