Short-term disability
Employees in the following Benefit Class are eligible to apply for Short-term disability (STD) benefits:
- Benefit Class 1: Permanent Full-time and Part-time employees
- Benefit Class 2: 1-year contract employees
- Benefit Class 4: Ordained Priests
There is no termination age for this benefit, providing that you continue to be: an insurable employee, actively at work, and meet the definition of disability.
Definition of Disability
This wage-loss benefit is available when eligible employees become disabled due to non-work-related injuries while insured and suffer a loss of earnings as a result. Disability means being unable to perform the essential duties of the employee’s occupation for your or any other employment due to illness or injury. Medical evidence must support this accordingly. The availability of work is not considered when assessing disability.
How is the STD benefit calculated?
The benefit is payable at 66.67% of weekly earnings. STD payments are paid weekly in arrears by the disability office. Weekly earnings are your annual earnings divided by the number of weeks you work and are paid for. Examples: 43 weeks (if the employee is a teacher and/or education assistant), 48 weeks (if a principal), and 52 weeks for a 12-month employee.
STD, which extends into summer periods (July 1st to August 31st), will stop on the last day of June for workers on a 10-month work schedule and resume in September if the disability continues. Workers on a 12-month schedule will have no interruption of payments. Sample benefit calculation (employee is a 10-month employee, earning $45,000/year):
- $45,000 (gross annual earnings) ÷ 43 (weeks worked) = $1,046.52 (gross weekly earnings)
- $1,046.52 (gross weekly earnings) x 66.67% (STD benefit amount) = $697.72 (STD benefit amount)
Non-taxable benefits
This is a non-taxable benefit; therefore, a T4A will not be issued by the disability office for Income Tax purposes.
Satisfying the waiting period
There is a 7 consecutive day waiting period from the last full day worked until the first day payable for disability. Statutory holidays are counted as part of the waiting period and are paid for by your employer. It is presumed you will use “sick days” according to your contract to remain at full pay during this waiting period.
If you apply for disability, you cannot use banked sick days more than the 7 consecutive days waiting period – even if you have them accumulated. This is a contractual stipulation with Canada Life that must be adhered to.
Long-term disability
Eligibility
Employees in the following Benefit Class are eligible to apply for long-term disability (LTD) benefits, providing that they continue to be an insurable employee, actively at work, and meet the definition of disability:
- Benefit Class 1: Permanent Full-time and Part-time employees
- Benefit Class 4: Ordained Priests
- This benefit terminates at age 65 as you are then eligible to receive Old Age Security (OAS) benefits.
Definition of Disability
LTD continues to be a wage-loss benefit available when eligible employees become disabled due to non-work-related injuries while insured and suffer a loss of earnings. Medical evidence must support that during the first 24 months of payments, an employee will be considered disabled if unable to perform the essential duties of the employee’s occupation for your or any other employment due to illness or injury. The availability of work is not considered when assessing disability. After 24 months of payments, the employee will be considered disabled due to illness or injury if unable to perform the essential duties of any occupation for you or any other employer for which the employee is qualified or could become qualified based on education, training, or experience. The availability of work is not considered when assessing disability.
How is the LTD benefit calculated?
The benefit is payable at 67% of pre-disability monthly earnings. This means that there is a lapse of time for a period of 1 month after the last weekly STD payment is issued to the first LTD monthly payment.
Your gross annual salary is divided by 12 (months) to calculate your monthly earnings. Please note that for Teachers and Principals, although you are paid over a 10-month period, your salary represents earnings incurred for a 12-month period.
Unlike STD, LTD payments continue throughout the summer (July 1st to August 31st), so there is no break in coverage.
- Sample benefit calculation (employee is a 10-month employee, earning $45,000/year):
- $45,000 (gross annual earnings) ÷ 12 (months per year) = $3,750 (gross monthly earnings)
- $3,750 (gross monthly earnings) x 67% (LTD benefit amount) = $2,512.50(LTD monthly benefit amount)
Non-taxable benefit
This is also a non-taxable benefit; therefore, a T4A will not be issued by the disability office for Income Tax purposes.
Satisfying the LTD waiting period
The waiting period before the employee can receive LTD payments is 119 days. Please note that the 119 days represents the 15-week benefit period for STD. Therefore, once you have exhausted the STD benefit, you are eligible for LTD benefits. Canada Pension Plan (CPP) Prolonged disability will prompt Canada Life to ask you to apply for Canada Pension Plan (CPP) disability benefits. Your CPP income is deducted (direct offset) from your LTD benefit if approved.
Continuation of benefits & premium responsibilities
When approved for LTD benefits, benefit premiums for the Life, Optional Life (if you have applied and been approved), AD&D, STD, and LTD benefits are no longer due. However, you are still responsible for paying your share of the benefit premiums for the benefits not listed above (for example, Extended Health, Dental, and Critical Illness).
The waiver of applicable benefit premiums takes place on the first of the month following approval of your LTD claim by the disability office.
Pension and Vacation
Pension
Our Group Policy Contract with the pension department clearly states the following regarding your employer-matched contributions to the Registered Pension Plan (RPP):
“…if a member is unable to work because of disability (Short-term disability, Long-term disability or WCB), leave of absence or temporary lay-off, all contributions will cease during such periods.”
The Member may continue to make Voluntary (not matched by your employer) contributions to the Plan while on disability.
For an expectant mother who goes on disability prior to her official Maternity Leave starting, the Pension contributions must be suspended as well. Only when the Maternity Leave officially starts can the employee request to have her RPP contributions reinstated.
An employee who is on a maternity/parental leave of absence may continue to participate in the RCAV, RPP. This is the only type of leave in which an employee may opt-out of the pension plan, and then resume contributions upon their return to work.
Vacation
An employee usually receives credit for service while on STD for the purposes of vacation and employment security. An employee usually does not receive credit for service while on LTD regarding the Vacation Policy. In general, any vacation outstanding in respect of the employee at the expiry of the STD leave is paid out to the employee at the time they are accepted onto LTD.
LTD Plans or any type of disability insurance plans are considered Income Maintenance Plans/Wage Loss Replacement Plans.
Please refer to your employment contract to confirm if reference is made to your entitlement of vacation time or vacation pay.
Return-to-Work Program
Short-term and Long-term disability insurance plays a valuable role in replacing income lost due to a disability. The best outcome, however, is the return of employees to productive employment. The goal of rehabilitation is to help make that return to employability happen as early and as smoothly as possible for both the employee and the employer.
Employees engaged in approved rehabilitative employment will have their earnings from rehabilitative employment coordinated with their disability benefits. The employer must only pay for the hours/days the employee is at work.
The disability office will be in contact with your local employer to obtain the following information for the period that the employee worked the previous week:
- Specific days that the employee worked
- Hours worked per day by the employee
- Earnings paid by the local employer
The disability office will then calculate the appropriate disability benefit payment for you (the employee), based on your earnings through the school/parish. This process will continue until you return to work, full-time.
It is important to understand that income from all sources cannot exceed 100% of net pre-disability earnings while on a return-to-work program. This 100% clause does not apply if you are solely on disability.
It is your obligation as an employee to ensure that there is always clear communication with your local employer regarding when you are expected to return to work!