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ugh. Can my company do this?

Homerboy

Homerboy

Lifer
I have no idea how this stuff works and I'm pretty sure that the ATOT response will be "they can do what they want..." but I have to ask and just get it off my chest.

Since my date of hire, my company has paid 100% insurance for me and my dependents. Just today they emailed staff saying as of the paycheck 15th (yes April 15th) that they wold no longer cover the dependent portion of the insurance, only the employees. This leaves me on the hook for $750+ PER PAYCHECK ($1500+ per month) out of the blue. Nothing like picking up another mortgage out of the blue hey?

What even more odd, is when I was hired and insurance policies were being discussed they literally handed me the pamphlets that Blue Cross would hand to them employers themselves outlining all the plans they could choose from for their employees, and I was told to "pick one". I could pick any plan I wanted, high or low... it was my choice. I went up and back on this my direct boss and he said "hey they are giving you the choice and if they are giving you the choice... feel free to choose which you want" Naturally I took one of the most expensive plans offered.

I wouldn't have taken that planif I knew 8 months later I'd be responsible for paying for it...

I'm F'ed.
 
Doesn't the hiring contract contain specifics on this issue? It should, and you should then have grounds for litigation.
 
Absolutely they can do it, you just lost a benefit. They don't need your permission at all. And since you didn't have a qualifying life event it is unlikely you will be able to change plans, but in this case I would assume the employer would allow it so you could get a plan that isn't so expensive.
 
Originally posted by: newb111
Switch plans?
Click to expand...

That's your best option. Tell HR that you need to switch plans because of the increase in cost to you. If they object, just say there is no way you can absorb a $18,000/year pay cut.

I would expect they will accommodate you, since you probably aren't the only employee in this situation.

 
Originally posted by: spidey07
Absolutely they can do it, you just lost a benefit. They don't need your permission at all. And since you didn't have a qualifying life event it is unlikely you will be able to change plans, but in this case I would assume the employer would allow it so you could get a plan that isn't so expensive.
Click to expand...

Most insurance providers also have a hardship clause as well. If the company dicks you around, look into it. A hardship clause basically is your qualifying event.
 
sure they can do it, but any respectible company would have given you the option to change plans once they made a drastic change like that.
 
Originally posted by: kranky
Originally posted by: newb111
Switch plans?
Click to expand...

That's your best option. Tell HR that you need to switch plans because of the increase in cost to you. If they object, just say there is no way you can absorb a $18,000/year pay cut.

I would expect they will accommodate you, since you probably aren't the only employee in this situation.
Click to expand...

In this economy, they'd probably reply "Well, $18,000/year pay cut is better than an <Insert your salary here> pay cut." Sounds like what his company may say...
 
Originally posted by: CPA
sure they can do it, but any respectible company would have given you the option to change plans once they made a drastic change like that.
Click to expand...

well that's my point I guess... I will "happily" change plans, but to nt be given that option just seems ludicrous.
 
Let me add in that this is a small company, and it really is a fairly close knit group of people. They aren't looking to screw anyone over at this point. I just emailed the HR dude, my direct boss, and the CTO/President laying the deal on the line. They assured me that they are going to look into it and nothing would be withheld until its all figured out. They explained that the plan should not have been picked that way to start.... which at the time I told them over and over. Anyways, it seems that the worst case (I hope) is that I will change plans and have to pay that, or I will keep my plan and just pay the difference.

As a side note, I can only think of one other person in the company with dependents, so that's convenient.
 
It costs $1,500/month to pay for the dependents' cost? That just sounds extreme. Even individual insurance doesn't cost that much I think.

Do you get any credit if you waive coverage? Depending on the health status of your family you may be better off getting individual insurance for your dependents?
 
Originally posted by: yuchai
It costs $1,500/month to pay for the dependents' cost? That just sounds extreme. Even individual insurance doesn't cost that much I think.
Click to expand...

If the company was footing the entire bill - yeah. Individual insurance cost is generally fairly low. Once you start adding people the rates skyrocket. The last company I worked at I was paying nearly $600/mo for family coverage - which meant $1,200/mo when you included the company contribution (50/50 split). It's entirely plausible that a high tier plan could be $1,500/mo just for dependents, and probably $500/mo for individual.
 
Yeah my company went from a 3-teir to a 2-teir plan since it "only hurts a few of us" I was one of the few going from Single+1 @$75 to Family @$148 even though it is still just me and my wife. I guess it saved the family people a wad of cash.

Granted, not as bad as $750 every (what I assume) two weeks.
 
Just a small update for anyone that cares.
We "worked it out" that my insurance coverage got bumped down to a lower tier and now I "only" have to pay $700/month. Nothing like a $8400 pay cut.
 
That was the only other option? One that cost you $700/month? Wow. That sucks.

Can you at least pay with pre-tax dollars?
 
i would have asked for a bump to help cover the costs, since they offered you a job with full benefits. my full family coverage here would cost me about 250 every 2 weeks... my ex pays about 225 every 2 weeks, so the kids are on hers. she had to get me to sign a waiver that i had coverage at my own job, or pay a 150 a week penalty for spousal coverage. the company changed their policy when a canadian company bought them. before that, it was full medical for 75 a week for all 5 of us, including eye and dental. canuckistanians.
 
Originally posted by: SunnyD
Originally posted by: spidey07
Absolutely they can do it, you just lost a benefit. They don't need your permission at all. And since you didn't have a qualifying life event it is unlikely you will be able to change plans, but in this case I would assume the employer would allow it so you could get a plan that isn't so expensive.
Click to expand...

Most insurance providers also have a hardship clause as well. If the company dicks you around, look into it. A hardship clause basically is your qualifying event.
Click to expand...

I got a letter from blue cross saying that I could decrease my plan to a lower one. Might be easy.

Edit - I was also paying out of pocket $400 every 2 months for 2 people. I dunno, I'd rather pay way less monthly.
 
Originally posted by: kranky
That was the only other option? One that cost you $700/month? Wow. That sucks.

Can you at least pay with pre-tax dollars?
Click to expand...

Well it would be pre-tax dollars. Insurance always is.

I'm not sure what else I can do. Getting the insurance myself would cost even more would it not? I'm paying $8400/year for this, PLUS co-pays and premiums and such. That seems awfully steep still. Maybe I need to start to shop around...
 
Originally posted by: hanoverphist
i would have asked for a bump to help cover the costs, since they offered you a job with full benefits. my full family coverage here would cost me about 250 every 2 weeks... my ex pays about 225 every 2 weeks, so the kids are on hers. she had to get me to sign a waiver that i had coverage at my own job, or pay a 150 a week penalty for spousal coverage. the company changed their policy when a canadian company bought them. before that, it was full medical for 75 a week for all 5 of us, including eye and dental. canuckistanians.
Click to expand...

I dont think they are going to give me a "bump" to help offset the costs. Otherwise they would just pay the costs 🙂
 
it's HIGHLY unusual for a comp to modify plans in the middle of the year unless there's a change in control (sold to another company). HR signs contracts with benefits providers (Blue Cross/Aetna etc..) for coverage & those providers provide premiums based on the # of expected beneficiaries.

I would speak to someone at your state's compensation commission to see if this is kosher.
 
Originally posted by: Homerboy
Originally posted by: kranky
That was the only other option? One that cost you $700/month? Wow. That sucks.

Can you at least pay with pre-tax dollars?
Click to expand...

Well it would be pre-tax dollars. Insurance always is.

I'm not sure what else I can do. Getting the insurance myself would cost even more would it not? I'm paying $8400/year for this, PLUS co-pays and premiums and such. That seems awfully steep still. Maybe I need to start to shop around...
Click to expand...

I wonder if a high-deductible policy might save you some money. I don't know what they might cost, though.
 
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