Bethany Care Society Collective Agreement 2020-2024

LETTER OF UNDERSTANDING #1

BETWEEN

BETHANY CARE SOCIETY (BETHANY, CALGARY)
(hereinafter referred to as the Employer)

AND

THE HEALTH SCIENCES ASSOCIATION OF ALBERTA
(hereinafter referred to as the Union)

RE: BENEFITS SPENDING ACCOUNTS 
 

Effective January 1, 2019, the Employer will provide the following Benefits Spending Accounts available to Employees who are benefits eligible on January first (1st) of each year. There is no pro-rating for Employees with mid-year eligibility. 

• Personal Spending Account (PSA) – Taxable
• Health Care Spending Account (HCSA) – Non-Taxable.

Annual Allocation
On January 1st of each year (commencing on January 1, 2019), a sum of one thousand dollars ($1,000.00), per each benefits eligible Full-Time Employee shall be provided by the Employer for the Employee to allocate to one or both of the Spending Accounts noted above. 

The Spending Account allocation shall be provided to benefits eligible Part-Time Employees on a pro-rated basis. In order to facilitate enough time for the administrative process, the amount of the allocation for Part-Time Employees will be based on their Full-Time equivalency as of October fifteenth (15th) of each calendar year, rounded to the next higher dollar ($1.00).

The Employee may allocate funds by December 1st of each year, in whole or in part to the non-taxable Health Care Spending Account (HCSA) and/or to the taxable Personal Spending Account (PSA). Towards the end of each year Employees will be required to allocate their next year’s Spending Account into one or both of the accounts (whole dollar amounts only). Once Employees provide their allocation instructions, they will be unable to change their allocation until the following plan year. Each Plan year runs from January 1st to December 31st.

Employees who are laid off after January 1st in the year in which the funds are available, as long as they remain Employees of Bethany and on the recall list, shall maintain access to the funds for the balance of that Spending Account year January 1st to December 31st while on layoff.

Default Option and Unused Funds
Should the Employee not return their allocation form by the appointed date or if the allocation form is incomplete, the default option will be one hundred percent (100%) to the non-taxable Health Care Spending Account (HCSA). This is irrevocable and there will be no opportunity for late submission. 

Unused funds left in either the HCSA or the PSA at the end of each year will be carried forward to the following year. There is a maximum carry forward of one (1) year. If these funds are not used during the year to which they have been carried forward, they will be forfeited at the end of the carry forward year. Forfeited funds will not be available to be reallocated, paid out or credited to the Employee. 

Eligible Expenses
The HCSA and PSA are designed to cover different types of expenses as described below. Reimbursement will be provided upon submission of an original receipt.

Where the Employer chooses to contract with an insurer for the administration of the Benefits Spending Accounts, the administration of the Accounts shall be subject to and governed by the terms and conditions of the applicable contract between the Employer and the Administrator. Information regarding eligible expenses shall be accessible on the technology platform(s) of the Employer or the Administrator. 

Health Care Spending Account (HCSA) – Non-taxable
The HCSA may be used to pay for expenses not covered by the Provincial Medical program or the regular medical and dental plans provided by the Employer and as defined in Article 26: Employee Benefits Plan.  Eligible expenses will be reimbursed on a non-taxable basis.  Expenses must meet the requirements for deductibility under s. 118.2 of the federal Income Tax Act to be eligible for reimbursement from the HCSA. 

Personal Spending Account (PSA) – Taxable
The PSA may be used to pay for a range of personal medical, professional and educational expenses. Eligible expenses will be reimbursed on a taxable basis.

Taxability / Annual T4
Eligible expenses reimbursed under the HCSA are non-taxable to the Employee while those reimbursed under the PSA are taxable. 

Administration and tax reporting for the Benefits Spending Accounts will be adjusted as required to comply with applicable Federal and Provincial legislation.