Christian Schools International

No. 339 - January 24, 2011

To: Participating Board and Administrators
From: Howard Van Mersbergen, Executive Secretary-Treasurer

Short Term Disability - Cost savings gained by having the CSI Short Term Disability Benefit

Employment Insurance Premium Reduction - How you can save

Contact CSI for Support - Contact CSI if you have questions or need assistance

Plan Document estract regarding wage loss replacement provision - Reference #M067

Short Term Disability

The short term disability benefit provided by the CSI Insurance Plan combined with the Employment Insurance Premium Reduction creates a very cost effective benefit. For example, the EI premium savings for an employee with the EI maximum annual salary of $44,200 ($850 x 52 weeks) is $172.38. The cost of STD through the CSI Insurance Plan is:

At both the non-taxable and taxable benefit levels, the cost of CSI’s short term disability coverage is less than the EI premium reduction. Your school saves money AND you receive a higher benefit level than you would if covered by EI alone.

A key part of these savings is receiving the Employment Insurance Premium Reduction. Information on obtaining this reduction follows.

Employment Insurance Premium Reduction

Because the CSI Insurance Plan has a short term disability benefit, all employers participating in the CSI Insurance Plan will be eligible for an Employment Insurance premium reduction.

To qualify for an Employment Insurance premium reduction, federal legislation requires that employers participate in a written wage loss replacement plan that has benefits greater than or equal to those provided by Employment Insurance. A comparative analysis shows how the benefits of the CSI Short Term Disability Plan exceed those of the government plan.

Employers must return at least 5/12 of the EI premium savings to all employees when the reduced rate applies. This can be in the form of increased employee benefits, cash rebates or written mutual agreements between the employer and employee on the method of distribution.

A review of the attached contribution schedule for 2010 and 2011 illustrates the potential savings of the premium reduction.

If your school has never applied for the Employment Insurance Premium Reduction Program, it should do so by completing an Application for EI Premium Reduction provided by Human Resources Development Canada (form NAS-5022). To identify your school as part of the CSI Insurance Plan, reference RC# M067 on the application. This application, together with a copy of the attached extract regarding the Short Term Disability Benefits of the Plan should then be filed.

Starting in 2010, if you have already been granted an EI premium reduction, you will no longer need to complete renewal applications each year. This means that entitlement to the premium reduction will automatically continue until you change or cancel your approved short term disability plan. If your school has already filed an application and has received a yearly notice of the reduced EI premium rates from HRSDC, there is no further action you need to take.

If your school makes a change to your Short Term Disability Plan after it has been approved, for instance, if you purchase the non-tax disability upgrade to change the benefit from 66.7% to 75%, you must notify the Premium Reduction Program within 30 days of the date of change. You must also apply for a continuation of the EI premium reduction by completing a new Application for EI Premium Reduction.

Initial applications (form NAS-5022) for your Employment Insurance premium reduction must be received by HRSDC no later than December 15, 2011, to receive full monthly reduction for 2012. However, schools can still apply for a 2011 premium reduction. The amount of the reduction, within a plan year, is based on the date HRSDC receives your application. Therefore, the later the receipt of the initial application, the later your reduction will begin and the amount of savings will be diminished. Additional rules apply and may be obtained by reviewing an Employer Guide at http://www.servicecanada.gc.ca/eng/cs/prp/0200_000.shtml. All applications should be sent to:

Service Canada
EI Premium Reduction Program - Multiple Employer Plan M067
P.O. Box 11000
Bathurst, NB E2A 4T5
1-800-561-7923

Application forms can be found and downloaded at
http://www.servicecanada.gc.ca/eng/cs/prp/documents/nas5022.pdf.

Contact CSI for Support

More information about CSI’s benefit plans is located on our web site at http://www.CSIonline.org. Select Employee Benefits and the appropriate plan. If you
have questions, contact Bonnie Hofmann by phone at 877-274-8796, ext. 230 or by email at .

Plan Document estract regarding wage loss replacement provision

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