Benefit Compliance

jcanales · April 2011

An employee has been paying for insurance coverage for a dependent since 2010. As of March 2011, the insurance carrier changed and the amount of the dependent coverage cost more money. When the employee received her paycheck the 1st time after the new deduction was supposed to happen, she noticed that the new amount had not been taken out. The 2nd paycheck, the same thing happened, and now it has been 3 paychecks that the new amount has not been deducted. Each occurence, the employee personally brought it to the attention of the Accountant (who is responsible for our payroll), and each time, the Accountant has claimed that she "forgot" to make the adjustment.

Now, the employee has been told that she has to make up the difference of what was taken out of her paycheck and what should have been taken out, and is being forced to pay $80 more per pay period than the original amount for 12 weeks in order to recoop the money that the Accountant "forgot" to take out in the first place.

My question is, should this employee essentially pay back the company for a mistake that they (the accountant made) even when it was brought to their attention each time?

ACU Frank · April 2011

Yes. Since the employee was bringing it to Accounting's attention, it's logical to believe the employee was also fully aware of the shortfall and should have been budgeting accordingly.

This, of course, is entirely separate from any disciplinary action that should be headed the accountant's way...

Sharon McKnight SPHR · April 2011

jcanales,

Your first post! Welcome to the Forum.

Sharon

:welcome:

bbuckwalter · April 2011

The employee's obligation does not arise from her employer's mistake. She is paying the health insurer the money that she has always been required to pay. Because the mistake gave the employee more money in the prior paychecks, she suffers no loss in having additional money being deducted from future paychecks to even it out.

Cheryl S SPHR · April 2011

We would likely handle it differently. Given the fact the employee notified the appropriate person repeatedly and that person failed to do the correct thing, we might forgive those months and pay for them on behalf of the employee. Of course, the accountant should be subject to some form of discipline for repeating this mistake. It's a culture thing here!

NaeNae55 · April 2011

I can see both sides of this argument. On the one hand, the employee obviously knew there was a problem and should have been budgeting accordingly (not spending the money they knew should go for insurance). The company is spreading the payback over 12 months, when they could have made the period much shorter. Plus, the employee (and family) is the only one reaping from the benefit, so they should pay for it.

On the other hand. This employee was honest and sincerely tried to get the problem fixed. Having $80 come out over 12 weeks could put them in a financial bind. That seems more like a punishment to me.

Here the employee would have received an acknowledgement of their attempts and their honesty from top management. They probably would have had to repay the entire amount (due to the personal budget issue mentioned above), but we would have worked with them to make it as painless as possible. And most certainly the accountant would have been reprimanded. I think you have to make them pay it back, otherwise you encourage other employees in a similar situation to let it go for awhile in the hopes that they won't have to pay it back either. Just my 2 cents.

Benefit Compliance

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