Firm ties benefit increases to salary decreases

Lakeside Packers takes unusual approach to costs
By Uyen Vu
|Canadian HR Reporter|Last Updated: 08/29/2006

With increases in medical and dental benefits quickly outpacing wage increases, many employers have had to grapple with ways to rein in their premium contributions.

The way one employer is doing it — offsetting increases by adjusting salary scales — is raising some eyebrows.

In the first collective agreement between Lakeside Packers of Brooks, Alta., and the United Food and Commercial Workers Local 401, the employer’s benefit contribution is capped such that the “total cost of benefits paid by the employer shall not exceed the total cost paid by the employer in 2004.”