health insurance waiting period

OhioSmallEmployer · January 2002

We are a small company of about 25-30 people. Most of our employees are in a union. In our union contract, an employee becomes eligible for benefits the first of the following month after 320 regular hours. Depending on the time of the year, it could take 2 months, it could take 5 months to become eligible. Another problem is, sometimes we can not tell which month they will become eligible until the last minute since it's not a regular 40 work week but work relys on the weather.
After some new stricter rules put in place and because we are less than 50 employees, the insurance carrier we are with won't recognize the rules in our union contract. We have to choose from there list of waiting periods. 30, 60, 90 days from the date of hire or the first of the following month after 30, 60, 90 days. Also, they have to get the application in before the eligibility date or it won't be effective until the date they recieve it, up to 30 days. That's it.
I was talking with my insurance broker today and we both know it's a real delimna for us. I asked if there was a way to fudge the hire date. If that would be completely unlawful. I mean, there has to be some law or something that supersedes this carrier's new "policy". The only suggestion he had was to change our company policy to say something about hiring people in a temporary position (those hours don't count towards probation) then if we decide to keep them, then from that date those days will count towards the waiting period.

Has anyone run into this delimna or have any suggestions??

Terry · January 2002

I would suggest that you go back and look at how the employee is classified and this should help with the insurance company too. Most employers have a threshold for benefits offering them to full time employees that work an average of 30 hours (or 25 or 35,etc) a week or more. By having the 320 hours in the union contract, I can understand why you have a challenge, working a 30 hour week would make them eligible after 10.66 weeks. Take another look at the union contract and see if you can have different classifications of union employees. A suggestion for what seems like a seasonal business would be:

Full time regular - works (X = 25, 30, 35, 40 also look at your insurance contract) hours per week. Eligible for medical benefits after 90 days. Year around position.

Part time regular - works up to 24, 29, 34, etc you get the pix) per week. Not eligible for medical benefits. (you can offer holiday, sick etc if you choose). Year around position.

Full Time seasonal - can work full time hours but considered Temporary for the busy season and will be released after that time is past. Not eligible for medical benefits. (Seasonal varies based on state law and can be 6 or 9 months)

Part time seasonal - same as above, part time hours.

To take this a step further, you could review all positions with the same title and say that of the 10 waiters, only 5 are required full time regular, 2 parttime regular and 2 FT/1pt seasonal. To do this you really need to know your busy times and hiring patterns. There is some flexibility with this and you would need to audit hours, suggest quarterly basis, to make sure employees are staying within their category based on hours worked.

Of course, this depends on your union contract and state wage & hour laws.
Please feel free to let me know if this is helpful or any specifics in the union contract. I have had some experience with this in a former job.

shendrickson · January 2002

I can understand your dilema, to the best of my knowledge there is no statute prhibiting you from setting your own standard and writing your policy to conform to your own situation. For instance - most companies do not offer benefits to employees that work less than 30 hours per week - anything less they are considered part-time employees. We offer STD insurance at our company and when the employee is out with an injury and not working their premimums are deducted from their check so that they are not term'd in the system. However, prior to a new carrier coming on board in July, it was up to the employee to make sure that premium payments were made for hours not worked. If they did not get their checks in they were term'd in the system. As a general rule of thumb our company offers benefits after 60 days although the employee is not considered past a probationary status until they have completed 90 days. The 60 day time period is to allow time to generate an insurance packet so that the employees insurance is in effect upon completeion of the 90 day probation period. Considering the fact that your employees work product is affected by outside conditions you might want to consider a 30 hour per week minimum in a 60 day or 90 day new hire status prior to allowing them to participate in the benefits program. Thats my best advise unless you have a new hire enrollment 2 times per year which is also being done in some businesses. If they miss the first enrollment period they have to wait for the second. Good luck

Min · January 2002

We are a small hospital in Washington and we have 96 employees, which is quite a few more than you- however- we have a 90 period from date of hire- our employees have to work an average of 28 hours per week (118 hours per month- based on 4.3 weeks) in order to be eligible for medical benefits- and it can not be a temporary basis- if the employee does not have 118 hours in a month, they are not eligible. I do watch after an employee is on medical to make sure they keep the hours required. Hope this helps a little.

health insurance waiting period

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