Job elimination while on STD

Toby

We have an exempt employee who is on authorized Short Term Disability with approximately two more months off before being released for work. The position held is being eliminated in approximately 15 days, with no alternative job available. Does the STD payments continue until released, at which point,any severence benefits due the employee would then kick in?

AnneLa

What are the provisions of your STD plan? Are you self insured?

Toby

New Developments! No, we are not self funded. It has been determined that, yes,the STD Benefits will continue until the 26 weeks are up or the employee is released for work, whichever comes first. However, the Company wants to run the severance benefits concurrent with the STD. Doing this will reduce the STD amount by the severance amount. These are two separate defined plans which do not address the issue. Severance is paid by the Company. STD payments come from the insurance company. The employee was offered at enrollment the option of contributing to the premium in order to receive an additional 10% benefit if a claim is filed and approved. Yes, the option was taken and payroll deductions made. I do not believe the Company can take this action as they are, in effect, eliminating one of the approved benefits (both of which the Company acknowledges her entitlement) by combining the two amounts. Without taking sides. it is my contention that severance payments should commence immediately FOLLOWING the end of the STD Benefits.