Cutbacks

dodaniel

We are a non-profit, funded by the Federal government. We have just received our next 3 year contract and have to cut back in the fringe benefit area. We offer a "floating holiday" which consist of 8 hours of paid leave. You have to use this holiday before the end of the year or lose it.

My question is since the employees do not "earn" this holdiay, it is given as a perk, can we remove this holiday as a benefit. Only 1/4 of our employees use this holiday each year.

We are trying to keep from having to change our current policy of the company paying 100% of the employee's health insurance prem. to a 80-20 payment.

Thanks for your input.

Rockie

I am sure that given the choice, employees would probably rather give up the "floating" holiday rather than pay insurance premiums. However, this may not save you enough in cutbacks.

It is very generous that your company still pays 100% of employee health coverage. We did this also until this past year when we were faced with a 40% increase in our premiums. What we did was (1) bargain down with the insurance company as much as we could and (2) we implemented a two tiered health insurance system where employees who only needed "catastrophic" type insurance would fit into one plan (i.e., higher deductibles, out of pockets, etc.). The company continued to pay premiums for this segment at 100%. For those who needed additional coverage, they pay a percentage of the rate and the company pays the other part. This includes prescription drug coverage, lower deductible, lower out of pocket, etc. This has worked for us so far in somewhat controlling costs, but who knows what we will be faced with next year.

We explained to our employees what we were facing with the increased coverage and amazingly enough, they understood the necessity for the changes.

Good luck. This is never easy.

scottorr

[font size="1" color="#FF0000"]LAST EDITED ON 05-19-03 AT 03:58PM (CST)[/font][p]We have an 80/20 split, no one seems to mind. We offer two tier coverage as well. One lets you use out of network dx and the other does not.

As far as eliminating the floating holiday, I think you have every right to do so, unless you have a collective bargaining unit. Communication with your employees will be a key factor. Be up front and let them know that changes have to happen for financial reasons. Most ee are understanding.

At my last employer, which was a not-for-profit, we paid 100% for individual coverage but with any family plans, the employee had to pick up the difference.

You may want to go with a broker, it wouldn't cost you any more money but they would try and find a better price for you. They will take bids from other providers and do the comparison shopping for you.