The Employee Benefits (formerly known as the Band Employee Benefits) program is one component of First Nation Indian Government Support Funding

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1 Program Outline 1

2 The Employee Benefits (formerly known as the Band Employee Benefits) program is one component of First Nation Indian Government Support Funding Programs. The other components are the Band Support Funding, Tribal Council Program, and Professional and Institutional Development. 2

3 Purpose: The purpose of the Employee Benefits program is to provide funding to eligible First Nation and Inuit employers to support the employers share of contributions to pension and benefit plans for eligible employees Objective(s): to enable eligible Indian, Inuit and Innu employers to compete effectively in attracting and retaining the qualified staff required to manage and deliver programs and services, particularly those taken over from the federal government in recent years. giving (eligible employers) the opportunity to establish competitive employee benefit packages, comparable to other competing employers (e.g., federal, provincial and municipal governments, school boards, etc.) Includes: Canada Pension Plan (CPP) and Private Pension Plans (PPP) Group Insurance Life, Supplementary Health, Short and Long Term Disability Administration of Plan Underwriter fees, administration costs 3

4 First Nations Employers First Nations/Tribal Councils/Other (Education Authorities) Funding Agency Indigenous and Northern Affairs Canada (INAC) Third Parties Pension Plan(s) oversight provided by: Office of the Superintendent of Financial Institutions (OSFI) Federally Regulated Pension Plans Financial and Consumer Affairs Authority (FCAA ) (formerly the Saskatchewan Financial Services Commission (SFSC)) Provincially Regulated Pension Plans 4

5 Eligible Program(s) a program being the object of a funding arrangement with the department that was formerly delivered by DIAND, providing no funding for employee benefits is provided directly by the program Band Support Community Infrastructure (Facility Operations and Maintenance) Education Social Development Economic Development Lands and Trust Services Eligible Employers First Nation employers engaged in the delivery of services pursuant to an eligible program First Nations Tribal Councils First Nation Education Authorities 5

6 To receive EB funding, pension plans must be designed to meet the requirements of Revenue Canada Taxation (for CPP/QPP) and the PBSA 1985 administered by the Office of the Superintendent of Financial Institutions. To remain in good standing and receive continuing funding from the EB Program, employers must submit periodic reports to meet conditions of INAC, the Income Tax Act and the PBSA, 1985, or equivalent provincial legislation. 6

7 the organization must be funded by Indigenous and Northern Affairs Canada (INAC) for an eligible program a conditional transfer in accordance with specific program terms and conditions and based on reimbursing for eligible expenditures Unexpended balances or unallowable expenditures are debts owed to the Crown. To be eligible for EB, the employee must be engaged in the delivery of services for an eligible program a(n) (eligible) program (is defined as) being the object of a funding arrangement with the department, that was formerly delivered by INAC, providing no funding for employee benefits is provided directly by the program 7

8 The Employee Benefits program is comprised of two funding components: Statutory Benefits Canada Pension Plan Private Pension Plan Non-Statutory Benefits Group Insurance Administration Costs 8

9 Statutory benefits (Pensions CPP & Private) are provided as Set Contributions Unexpended and overfunding amounts at year end must be returned to Receiver General of Canada. Non-Statutory benefits (Administration and Group Insurance) are provided as Fixed Contributions Unexpended funds may be retained and spent within the IGS program by the end of the next fiscal year. The Recipient must obtain INAC approval to transfer funds to other program areas. 9

10 Matching contributions (per year) CPP (Eligible salary - $3,500) x 4.95% to a maximum of $2, (for FY2017/18) PPP only Eligible salary x 10.45% (maximum, Pension Plan will dictate maximum) CPP + PPP CPP as determined above + PPP limited to 5.5% of eligible salary Group Insurance To a maximum of 2% of eligible salary per Private Pension Plan participant (not intended to cover Individual Health Plans like Blue Cross) Note: Matching contributions for above (employer share will not exceed employee share of contributions) Administration (for employees participating in a Private Pension Plan) 10 or less eligible employees $125 x # of employees 11 or more eligible employees $1,000 + $25 x # of employees 10

11 Employment Insurance Workers Compensation Pay in Lieu of Vacation Prior pensionable service of employees Individualized Health Plans (eg. Blue Cross) 11

12 Eligible Employer Applies for pension plan registration and funding Selects an insurance company, trust company or investment manager to hold, manage and deposit pension and benefit funds on behalf of employees Maintains compliance with regulations through reporting and remittances Ensures payroll deductions are held in trust and separate from operating funds Completes and submits an Employee Benefits yearly application (PAW 41802) due January 31 and report (DCI 41784) due April 30 12

13 Indigenous and Northern Affairs Canada Funding Service Officer Manages Agreements on behalf of INAC Provides program oversight for, and advice to, Eligible Employers Regional Office Reviews information provided through yearly reconciliation exercise Updates and maintains National Indian Government Support System (IGSS) Band Employee Benefits (EB) database Sets initial funding levels for the new fiscal year based on reconciled data as provided by the First Nation employer(s) 13

14 Funding Service Officers Manage agreements on behalf of INAC Ensure compliance for terms and conditions in agreements Provide oversight and advice on all EB applications and reports Review all applications for eligibility of employees Reconcile application amounts with contribution amounts for previous year. Follows up with First Nations regarding Office of the Superintendent of Financial Institutions Canada (OSFI) late remittances and outstanding reports notices (only in the sense of information gathering, but, in extreme situations, will halt funding). (Presuming this will be the same for those plans now under provincial jurisdiction, Financial and Consumer Affairs Authority (FCAA)) 14

15 INAC will not: provide mediation between plan provider and/or employer and/or employee It is inappropriate for INAC staff to discuss an individual's situation with regards to private pensions. All discussions about an individual's pension plan and/or pension situation should be kept between that individual and the pension plan manager (administrator or financial planner) provide or make allowances for payment directly to plan providers on behalf of First Nation employers 15

16 OSFI supervises federally regulated private pension plans and intervenes in a timely manner to protect members and beneficiaries of pension plans from loss, while recognizing that plan administrators are ultimately responsible and that funding difficulties can result in a loss of benefits. FCAA The Pensions Division protects the accrued or accumulated pension entitlements of plan members from undue loss and promotes the equitable treatment of plan members (under Provincial Jurisdiction). (Roles copied from Websites of OSFI and FCAA) 16

17 Applying, and receiving re-imbursement, for Employee Benefits is a two step process: 1. Annual Application 2. Annual Report 17

18 Since the Fiscal Year, the applications for Band Support Funding and Employee Benefits have been combined into one application (same is true for Tribal Councils and Other (eligible) Organizations. Users indicate at the top of the application what program they are applying for and complete the appropriate section. For Employee Benefits, this is an estimate which will then incorporated into the new year funding arrangements. This will be verified in the reporting phase. 18

19 Typically due January 31 st, although this date may be changed depending on program requirements Depending on the type of organization, there are three different applications to complete: FIRST NATION APPLICATION FOR INDIAN GOVERNMENT SUPPORT PROGRAMS PAW TRIBAL COUNCIL CONSOLIDATED APPLICATION FOR FUNDING PAW APPLICATION FOR BAND EMPLOYEE BENEFITS - ORGANIZATIONS OTHER THAN FIRST NATIONS AND TRIBAL COUNCILS PAW All information boxes must be filled in (completed) 19

20 Due April 30 th Depending on the type of organization, there are three different reports to complete: FIRST NATION REPORT FOR INDIAN GOVERNMENT SUPPORT PROGRAMS DCI TRIBAL COUNCIL REPORT FOR INDIAN GOVERNMENT SUPPORT PROGRAMS DCI BAND EMPLOYEE BENEFITS REPORT - ORGANIZATIONS OTHER THAN FIRST NATIONS AND TRIBAL COUNCILS DCI These reports include a form for the creation of a listing of employees for the previous fiscal year, this will be used to reconcile previous year funding amounts, forecast current year funding requirements and set initial budgets for the upcoming Fiscal Year 20

21 Programs Eligible Non-Eligible Reimbursement Examples EB Program Recap Interesting Searches(?) 21

22 Receives program funding from INAC Band Support, Community Infrastructure (Facility Operations and Maintenance), Education, Social Development, Economic Development and Lands and Trust Services Program will have Salary Based, Part or Full Time positions 22

23 Eligible INAC Funded Programs: - Band Support (Band Manager, Admin Clerk, Finance Officer) - Community Infrastructure (Maintenance Worker, Sanitation Worker, WTP Operator) - Lands and Trust Services (Lands Officer) - Education (Teacher, Principal, School Janitor, School Receptionist) - Social Development (Social Development Worker, Home Care Worker provided Salary provided by INAC ) - Economic Development (Ec Dev Advisor provided First Nation is managing its own Ec Dev program and funding) 23

24 Receive funding through sources other than INAC IE. Health Canada, Justice, Own-source (private) Project based employees (including major capital), Contractors, Employees of another Government Department, private enterprise employees IE. Bus Contractors, Daycare Workers, Health Nurse Employees whose positions are funded through proposal programs IE. Lunch Program Workers, Education/Teaching Assistants, etc 24

25 Ineligible Other Funded Programs: - Block funded ICFS Agencies (Case Manager, Foster Care Worker, Intake and Investigation Workers, Receptionist and Clerical) - First Nations and Inuit Health Branch Canada (Nurse, Additions Counsellor, Receptionist) - RCMP (Police Officer, Justice Coordinator, Receptionist) - Others (TLE Trust Manager(s), Specific Claims Advisor(s), Contractors, Project Employees, Store Employees, Daycare Workers, Board Members) - Proposal Driven Program Positions (Summer Work, Mentored Work, Education Assistant (High Cost Special Ed (Direct Services)) - any proposal program that allows for benefits along with Salary 25

26 Employee contributing to Canada Pension Plan, a Private Pension Plan and a Group Insurance Plan Eligible for: CPP matching contribution up to maximum allowable (or 4.95% of (salary minus $3,500)), plus PPP matching contribution up to maximum allowable of 5.5% of salary, plus Group Insurance matching contribution up to maximum allowable of 2% of salary, plus Administration costs 26

27 Employee contributing to Canada Pension Plan, a Private Pension Plan but not a Group Insurance Plan Eligible for: CPP matching contribution up to maximum allowable (or 4.95% of (salary minus $3,500)), plus PPP matching contribution up to maximum allowable of 5.5% of salary, plus Administration costs 27

28 Employee contributing to the Canada Pension Plan only and not a Private Pension Plan Eligible for: CPP matching contribution up to maximum allowable (or 4.95% of (salary minus $3,500)) Not Eligible for: Group Insurance Administration costs 28

29 Employee contributing to a Private Pension Plan only and also a Group Insurance Plan Eligible for: PPP matching contribution up to maximum allowable of 10.45% of salary, plus Group Insurance matching contribution up to maximum allowable of 2% of salary, plus Administration costs 29

30 Employee contributing to a Private Pension Plan only but not a Group Insurance Plan Eligible for: PPP matching contribution up to maximum allowable of 10.45% of salary, plus Administration costs 30

31 Employee contributing to a Group Insurance Plan but not a Private Pension Plan Not Eligible for BEB 31

32 Eligible salaried employees contributing to Canada Pension Plan, a Private Pension Plan and Group Insurance Eligible salaried employees contributing to Canada Pension Plan and Group Insurance Eligible salaried employees contributing to a Private Pension Plan and Group Insurance Eligible salaried employees contributing to a Private Pension Plan Eligible salaried employees contributing to a Group Insurance Plan only Ineligible employees contributing to Canada Pension Plan, a Private Pension Plan and Group Insurance (or in any combination of above) Eligible for: CPP matching contribution to maximum allowable PPP matching contribution to maximum allowable Group Insurance matching contribution to maximum allowable Administration Costs Yes Yes No No No No Yes No Yes Yes No No Yes No Yes No No No Yes No Yes Yes No No

33 Using a Search Engine (Google) INAC Applications Gets you access to the Proposal, Applications and Workplan (PAWs) Yearly application for EB First Nations Reporting Guide Gets you access to the program reports (DCIs) Yearly report for EB INAC EB Program Gets you the program Policy OSFI Gets you who they are and what they do (Federally regulated Pension Plans) FCAA Gets you who they are and what they do (Provincially regulated Pension Plans) 33