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Challenges Employers Face with Increased Disability Claims

February 9, 2024 from Talent Canada

The disability claims landscape has experienced notable changes, especially due to the impact of the pandemic. As discussed in an article by Talent Canada, the trend of disability claims has been consistently increasing and shows no signs of slowing down. This increase in claims, driven by a range of factors, poses numerous challenges for employers as they navigate the complex world of employee benefits and support systems.

The rise in disability claims can be attributed to the growing prevalence of mental health issues. The article emphasizes the significant increase in disability claims related to mental health concerns, indicating the alarming scale of these issues in Canada. Despite some slight improvements following the lifting of lockdowns, a significant portion of the Canadian population, around 20%, still faces ongoing mental health difficulties. This concerning pattern puts a considerable burden on employers, who are now faced with the challenge of maintaining both the well-being of their employees and the stability of their organization.

Financial Pressures: Given the increasing costs of benefits, organizations are under significant pressure to effectively manage their financial performance. When it comes to providing healthcare coverage, employers have the responsibility of maximizing the value of their offerings, whether they are basic or more comprehensive benefits. However, the issue arises when employees on long-term disability (LTD) require ongoing assistance with health and dental benefits. The ethical dilemma of discontinuing benefits for vulnerable employees versus the financial burden of sustaining coverage poses a major challenge for organizational leaders.

Policy Development: The article emphasizes the significance of creating a benefits policy that is in line with the values of the organization and efficiently handles costs. Developing such a policy necessitates a thorough and methodical approach, beginning with a comprehensive examination of contractual obligations, financial commitments, and established precedents. Gaining support from important stakeholders and effectively communicating new policies are crucial steps in this process.

When developing a framework for long-term disability benefits, employers need to take into account several important factors. These factors encompass contractual obligations, financial implications, existing precedents, organizational buy-in, and effective communication of policies. Every factor is essential in developing a successful and enduring benefits framework that caters to the needs of employees and the organization as a whole.

The increase in disability claims poses a complex challenge for employers, requiring thoughtful analysis and strategic preparation. By considering factors such as mental health support, financial pressures, and policy development, organizations can better navigate these challenges. Although there is no universal solution, taking proactive measures and establishing a well-defined benefits management system can assist organizations in finding a middle ground between supporting employees and maintaining financial stability when confronted with a rise in disability claims.


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