Employee benefit plans may include a wide range of life insurance benefits, accidental death and dismemberment coverage, long-term and short-term disability benefits and medical, drug and dental coverage. Employers are also increasingly offering Healthcare Spending Accounts (HCSA), which provide employees with an annual fund to draw from for reimbursement on a wide range of eligible health and dental expenses on an advantageous tax basis. These various plans can be complex in order to manage the financial and other risks of providing the benefits and to ensure tax-effectiveness. Some employers also provide for employee benefits after an employee retires; however, due to the increased costs, the recent trend has been to reduce or terminate benefits, require retirees to pay premiums or establish an ongoing HCSA as an alternative.
Equity-Based Incentive and Savings Plans
Equity-based incentive and savings plans are useful tools in building effective compensation structures. These plans are very commonly used to reward and retain executives for the medium to long term. There are a myriad of possible plan designs available, including share purchase plans, phantom share plans, share appreciation rights plans, deferred share unit plans, share option plans, performance share unit plans and restricted share unit plans. In order to ensure that unintended legal consequences do not arise when implementing these types of plans, employers must consider the requirements of the Income Tax Act and provincial securities legislation.
Employee benefit plans may include a wide range of life insurance benefits, accidental death and dismemberment coverage, long- term and short-term disability benefits and medical, drug and dental coverage.
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Doing Business in Canada
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