Employment Benefits Canada



employment benefits in Canada are one of the most overlooked aspects of evaluating a job offer.

Sure a great salary is where you main focus should be. But the benefits can add up to a hefty chunk of change. So how do you go about evaluating what those benefit bucks are worth?

Depending on the industry and who you talk to the general rule of thumb is that for $1 spent on wages there are from $1 to $3 spent by employers for benefits. Since this will vary somewhat by occupation this page will give you an approximate idea of the value of the typical employment  benefit package in Canada. I will assume a wage of $20 per hour for the purposes of this illustration.  All dollar amounts are CAD or Canadain.

Vacation
Lets start with everyone's favorite benefit; vacation accrual. The average employer will give you approximately two weeks of paid vacation. if you earn $20 CAD per hour that means you will earn approximately $1600. Obviously, if you work in a job where the ability to earn more vacation time, then the value goes up. If you earn 4 weeks of vacation then the value of the benefit becomes $3200. 2098

Sick Time
Most employers will grant you sick time for the occasional flu, sick child and other short lived health crisis. If you are granted one week of sick time each year then you will have the potential to earn approximately $800 in value. Of course, not every one will use the whole week.

In Canada if you are an employee who is unable to work due to illness you are covered by Employment Insurance benefits. While the government administers this program it is available to workers who qualify by having at least 600 hours of employment during a calendar year.   The amount of time you can be out sick is up to 15 weeks.  The maximum you can be paid is $468 per week or 55% of your income. Based on earning $20 per hour your maximum sick benefit would be $440 per week.   Employers contribute to this as part of an insurance pool or can 'self insure" to a greater or lesser extent.  They can exceed the minimum benefit amount and duration but cannot pay less than the government mandated amount. UI benefits also include time off for pregnancy, maternity and care giving of a child or dependent adult such as your parents.

I am calculating an average benefit of $800 per year for this.

Medical/Dental/Vision Insurance
In Canada basic health care is provided to all residents of Canada.  What is not covered is pharmacy, dental, vision and some cosmetic surgeries.  Private rooms in the hospital or faster access to the doctor can also be covered by supplemental insurance.  Employers in Canada may provide this supplemental health insurance.  There is no absolute standard for what employers pay for this benefit. The national average cost for medical premiums paid for by employers is approximately $250 CAD per month. If you have an employer willing to spend the money this benefit is worth up to $3000 regardless of your hourly wage. 

Education

One overlooked benefit is education dollars. Many employers will pay for you to keep up with current happenings in your profession and to improve your knowledge. Of course, healthcare workers are required to know and maintain proficiency in CPR and advanced life saving techniques. Some examples of things paid for can include; travel expenses, books, fees and tuition and paid time while attending the class. Estimated value is $800-$1500 annually.  Be wary of employers who don't pay for continued education and ongoing certification.  That's an extra $800 to $1500 per year you will be paying for out of your own pocket.

Holiday Pay

IIn Canada the average number of publicly paid holidays is 11. This adds up to approximately 88 paid hours per year for a benefit of $1760 extra per year. Of course, many healthcare workers wind up working the holidays for an additional premium of being paid time and one-half for working the holiday. For some that's not considered an employment benefit and for others it is.

Retirement Plans

There are generally two types of retirement plans. One is the old style plan where you contribute nothing and the company puts in the money every month to a pension plan. This is called a defined benefit plan.  only about 40% of all employers offer a defined pension plan. The majority of these are large corporations and government employers. The more common retirement plan offered is the 401K.   These are called defined contribution plans.  In Canada an employee can contribute up to 18% of thier base salary to a 401K.   Over 80% of all employers offer a matching amount.  If you contribute they will match it up to a set amount.  the average is 5%.  Based on a 5% matching contribution this benefit is worth approximately $2080 per year.

Canada Pension Plan
Believe it or not this is an employment benefit in Canada. A percentage of your salary is paid by the employer and you are assessed a percentage. This goes into a fund similar to the U.S. Social Security system.  Thegoal is to provide you with approximately 25% of your average earnings during your working career.  There are some restrictions and the Canadain national average monthly CPP was about $504 per month in 2010.  In the U.S. an employer's share is about 6% of the employees salary with the employer contributing approximately 6% .  In Canada based on available data the maximum amount an employer will pay is about $3150 per year.  Based on our hypothetical salary of $20 per hour it is worth $2496 if the contribution is 6%.

Employment Benefits Canada Total Value

Assuming a conservative estimate these benefits can add up to over $10,000 on the lower end and well over $20,000 on the upper end of the scale. One popular benefit and wages estimator site placed the median benefits at over $20,400 for a typical western medium sized community for a registered nurse.

The next time you size up a salary offer be sure to ask about the  benefits too. Our Canadian examples used here averaged over $13,200 to just under $15,000 CAD.