Health Insurance Premium Deductions

js

Our company provides health insurance benefits to our employees. Employees are eligible for insurance after ninety days provided they are full time employees (30 or more hours per week). The company contributes one half the single premium cost for each employee (this amounts to $95.00 towards their health insurance costs regardless of what coverage they choose and at what cost). We have a policy that states the employee will be responsible for their own regular portion of the insurance premium PLUS the company portion for any week they earn under 30 hours. We do not hold FMLA, ADA, Jury Duty, Military Leave, Lack of Work, etc. against the employee when charging them the company portion. We do count all sick time, whether documented by a health care professional or not, against the employee if it is not FMLA or ADA.

I am trying to change some of the policies in our company and would like some advice on this one. I know that we can not discriminate for our exempted reasons above. I also know that we have to keep track so we can back the payments we never made back out of our tax exemptions. I know our contract with our health insurance carrier is an issue at well. This policy is in writing, in the handbook, and signed by each employee.

What other issues are we in legal danger of when forcing employees to pay their regular insurance payment PLUS the company portion on a changing weekly basis?

Don Avery

Is the amount saved worth the hassel? What are the type of occasions that might cause an employee to work less than 30 hours. Are there times that they are not scheduled for at least 30 hours? How often does it happen that they are paid less than 30 for any reason? Would it be feasible to classify employees by their regularly scheduled hours? EX: reg.Sched. less than 30, or reg sched. 30 or more.

js

I appreciate the reply.

The amount of money saved is not worth the lower morale in my opinion.
Otherwise, thanks to computers, there is no hassle.

Employees earn under 30 hours due to medical (non-FMLA, ADA) absences, personal leave (longer than 1 week duration), and just missing time due to personal reasons. Everyone is scheduled 40 hours.

About 3 people a week end up paying the company portion of the insurance.

There are rules against singling out employees in one classification for a different type of insurance than others in their classification, or at a different base price. If a person falls under what we classify as full time for a single week, can we charge them for it?

Don Avery

To the best of my knowledge (but since I am not an attorney that isn't extensive), there is no legal bar from your present practice. We reqired employees to pay the whole premium after 4 weeks of unpaid leave regardless of whether they were FT or PT. We used 4 weeks just to make it less of a record keeping hassle. In your case, I would hate to have to reconstruct the records if you ever had a payroll program glitch.
If I had the task of trying to persuade the theory X people (most likly your adversaries on this issue are the Finance/Accounting people) I would calculate the frequency and associated savings using the current system, show a frequency distribution of occasions by employee and by length of each occasion, to get a handle on the scope of the practice. It also would be helpful to quantify all complaints associated with the practice and especially any termination that might have partially been attributed to this practice, and then I would survey other employers within your hiring area to see just how much your policy may put your company at a disadvantage for hiring. I would then try to quantify the cost of the disadvantage and compare it to the cost in premiums not recovered, that would be caused by changing the policy. Good luck.