withholding for insurance
valentine
116 Posts
Our employees are paid bi-weekly and we hold out for their health insurance bi-weekly. We pay the insurance company one month in advance.
We recently had an employee who became eligible for benefits on March 1st get quite upset because we took out for insurance for two weeks. The pay period went from 2-16 to 3-1. When the employee leaves, his insurance is paid to the end of the month so he picks up the payment on the end. He is saying we should only have taken out for March 1st since that is when his benefits began.
Could other companies who pay bi-weekly tell me how they take out for health insurance? I don't know of any other way to withhold the insurance.
Thanks
Valentine
We recently had an employee who became eligible for benefits on March 1st get quite upset because we took out for insurance for two weeks. The pay period went from 2-16 to 3-1. When the employee leaves, his insurance is paid to the end of the month so he picks up the payment on the end. He is saying we should only have taken out for March 1st since that is when his benefits began.
Could other companies who pay bi-weekly tell me how they take out for health insurance? I don't know of any other way to withhold the insurance.
Thanks
Valentine
Comments
I wait until they have been covered by the insurance for a week before I deduct any premiums. Our bi-weekly employees are paid every other Wednesday. Therefore, in your example, what I would do is wait until the March 12 paycheck to deduct premiums and then I would only deduct for one week of premiums. When the employee terminates, I do deduct total premiums from their final paycheck as they are covered through the end of the month. I have never received any complaints (from employees or our accounting department) regarding how I deduct premiums.
At the end of employment, the employees coverage will normally stop on the actual date of termination and COBRA premium is paid (pro-rated by day)prior to the last day of the designated period (normally 60 days, but I have heard of plans that are written as 45 days).
In any event, the X-employee will pay the premium back to the day after termination, and the next months premium prior to the next months beginning date.
We always start the employee coverage on the 1st day of the next month after the completion of the 60 day waiting period. I have one new manager that enrolled on the 3rd March; he and his family will not be covered by our insurance until the 1st day of the next month after 60 days which means June 1, 2003. Therefore, he will have waited almost 90 days. His first premium will not come out until the pay week which covers June 1, 2003 and that is June 13, "PAYDAY". HOPE THIS HELPS! Pork