Benefits for Part-time employees
6327515
12 Posts
Our CEO and President would like to offer benefits to our employees who work 20 or more hours.
Currently we are only offering benefits to our employees who work 40 hours a week and we are paying for employee only coverage on all benefits - health, dental, vision, STD, LTD, a life insurance policy and a cancer policy.
If we begin offering these benefits to part-time employees do we have to offer our part-time employees all the same benefits?
Wouldn't you consider part-time a different classification?
In addtion can we require our part-time employees to pay for half or all of their benefits even though we pay for all of our full-time employees' benefits?
Also does anyone have any pros or cons to offering part-time employees benefits?
Comments
We offer our part time employees who work at least 22 hours the same benefits we offer our full time employees who work 37.5 hours.
We pay 75% on medical & dental coverage premiums and 100% for employee only on STD, LTD, and Life Insurance.
It seems to me that if you're going to offer benefits to part time employees as well as full time, there needs to be equal coverage. Otherwise, it could be viewed as discriminatory. Especially so if your part time employees are a majority women or any minority.
As far as pros/cons...
We find that we are able to keep good part time employees because they don't have to worry about finding another job that will offer them benefits.
Cons are of course cost, however it may cost more to replace them than it does to offer them benefits and retain them.
You need to also check with your insurance carrier. Some have minimum standards such as eligibility based upon hours worked. It might possibly skew (either positively or negatively) your renewal rates depending on the population if you are group-rated.
That said, we offer benefits to anyone working 30 hours or more. The companies that I know that offer benefits to part-time employees usually do charge higher employee premiums than for fulltime employees.
Another thing to think about is the eligibility/service requirement. Since many PT jobs have high turnover, you might consider whether you can have their eligibility be different than FT employees. It might again be dependent on the contract with the carrier and possibly some non-discrimination issues if you are self-funded.
We started giving benefits to part timers in '06. Later, we reduced both of our shifts to part time hours. Participation on the day shift, the former full time shift, maintained the same levels of participation. The night shift, staffed primarily by higher turnover student labor, added only minimal participation and had no measurable effect on turnover.
Take a look at who your part time employees are: if they're not likely to participate, you may well end up with more paperwork, longer benefits meetings with more questions, no benefit on the turnover side, and only a cost increase to show for your efforts.
The "full time" / "part time" distinction is not codified in law, that will come from your plan, so you need to check individually with your providers to make sure they'll let you go to 20 hours. It was no problem for us.