Withholding for health insurance

valentine · March 2003

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

LindaS · March 2003

Our health insurance runs current so the week the employee is working is the same week they are paying insurance for on their checks. In all the companies I have worked for it has run current and is easier to explain to the employee.

valentine · March 2003

Hi Linda:

I'm not sure I quite understand how you do that paying bi-weekly. The paycheck dated March 7th would show health insurance taken out for the weeks of 2/16 and 2/23. It is a fixed amount; however, the employee's benefits didn't start until 3/1. Would you have just taken out for 3/1? What about the end when the employee leaves? If he left at the beginning of the month, he would still get the whole month of insurance.

LindaS · March 2003

I would have just deducted for 3/1 and not taken the entire premium off. The paycheck dated 3/21 would be the first one where the entire premium was taken off. Regarding when the employee leaves - an employee usually gives a two=week notice and you can determine when their last check will be. With a very few exceptions the employee will be receiving a final check that allows you to deduct the 2nd part of the monthly premium from their check. In those instances, I have "double-deducted" the premiums for that month off the final check.

Craig Allen · March 2003

Our county also pays employees bi-weekly, but our medical insurance witholdings are taken from the first two paycheck in each month. At this time, these witholdings are for the current month in which they are deducted from our paychecks. Under our insurance plan, coverage is for a month at a time, and so long as an employee works one day into a month, he or she has medical insurance coverage for the entire month. We have experienced a problem, with employees who remain on our insurance plan, but do not receive a pay check from our county auditor's office. For instance, certain workers' compensation employees, and short term disability employees.

I have suggested that our county auditor begin witholding insurance "premiums" for paychecks at least one month in advance. For example, the witholdings from our paychecks for 4 April 2003 and 18 April 2003 will be accounted for as paying premiums for the month of May 2003. If for some reason an employee is terminated or quits after the April 18 payroll is completed, but before 1 May (which means that he or she will not be covered by our plan after 30 April), then we can refund this witholding in the employee's final paycheck, which would be dated 2 May 2003.

Our thoughts are that it is easier for us to reimburse an employee, that it is for us to compel them to pay for their insurance out of pocket.

DeidreFR5 · March 2003

I'm also a bi-weekly, Massachusetts payer. We have a strange pay system. Here is an example - On 2/28 we paid any adjustments owed for we 2/15, actual hours for we 2/22 and estimated hours for we 2/28. Deductions would be for those actual weeks. The Er pays in advance for the insurance and technically the Ee reimburses us as we go. The Er does get caught when some employees terminate. Hope this helps.

Withholding for health insurance

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