What to do about Part-time Permanent Employees Health Insurance

RPWilkins

Our Employee Handbook/Personnel Policy states a permanent part-time employee is eligible for health insurance coverage at a pro-rated amount. Insurance policy says" part-time employees are considered eligible if they work a minimum of 30 hours per week and fees are collected through payroll deduction.

It has been the policy of the corporation to allow employees who go from full-time to part-time to work between 20-30 hours per week to pay 1/2 of the premium costs for health insurance (for full-time employee, corporation pays 100% of premium.)

Problem:
Employee hired as temporary part-time. Later the employee was made permanent part-time employee. Formal offer of health insurance not made; however, employee required to review handbook. One year later, employee was made full-time employee and health insurance provided. Employee now wants payment for premiums not paid for her during part-time status, even though she was in desparate financial condition and would probably have declined coverage due to her not being able to pay the 1/2 premium in the amount of $114.00 per month.

Question:
Should we offer to pay any-out of pocket medical expense that would have been covered?

Theresa Gegen TX

The question is did she have any out of pocket medical expenses during that year? If so, you probably need to pay them (to the extent that they would have been covered). Or if she purchased alternate insurance, she could possibly have a claim for the difference in cost. What I would not do is pay her the amount you would have paid for the insurance. If she had no out of pocket medical costs during that year, that would be a windfall to her.

Good Luck!!

Down_the_Middle

I do not believe this lady is entitled to any cash as "damages" for premium payments not made on her behalf. To do so would be to convert her non taxable health benefits into taxable income and that seems goofy to me. I agree with Theresa's question about out of pocket expenses incurred and that would be reasonable to explore with her. Outside of that, I'd try and focus on the future benefit for her, learn from the error made in not offering her the coverage on a timely basis and move on. Hopefully, there weren't any other benefits for which she was eligible but not offered. Good luck......

System

Quick comment is that you should never use the term "permanent" when referring to employees as this could be construed as a promise of continued employment, i.e. employment contract.