extended health benefits premium changes employee and employer 3 months

[Conner Lantz]

#80703

Employer has always had premium deduction for extended benefits LTD, STD, Basic life, AD&D, health and dental 50% paid by employee and 50% by employer without factoring the taxable benefits portion of the LTD, STD, Basic life and AD&D. We are trying to be compliant and adjust the premium payments and the coding correctly. It most offer letters it says the benefits plan is paid 50/50 we will be moving to LTD, STD, Basic life, AD&D, 100% paid by employee and Heath and Dental will be 25% paid by employee and 75% paid by employer effective Jan 1 2020. Is this an issue and how much notice do we need to give the employees for this change?
below is a blurb on a person offer.
Benefits: After your Probation Period, you will be eligible for enrollment in the Company’s group benefit plan. At that time, you will be entitled to a 50% coverage of your premiums for extended health and a 50% coverage of your premiums for MSP. Additional details regarding the group benefit plan and the availability of family coverage will be reviewed with you during your Orientation Program. You will be entitled to three (3) paid sick days per year, which will be prorated on first year of employment.
The Company reserves the right, at its sole discretion, to unilaterally modify all plans, including, but not limited to, pay rate, commission and bonus plans, as deemed necessary to meet the operational needs of the Company

[Conner Lantz]

#80702

Although you have communicated that changes can take place at the company’s discretion for operational needs – if push came to shove, you could be in a difficult situation having to prove the operational need. This proof could be at the cost of a civil case and all the associated costs with a legal action. It is highly likely that any mediator or court would default to “reasonable notice” and whether or not that was given. Of course “reasonable notice” is difficult to determine because it is dependent on the severity, need, and operational costs or undue hardship to the company.
In this case, it is not unreasonable to default to as much notice as possible, especially given the effect to employees take home pay and benefits. Employees might need time to consider signing up to a partner’s plan in the event that they opted out because yours was better at the time. They may also need time to consider the slight impact to their take-home pay and what, if any, concessions need to be made.
It would not be unreasonable to give as much notice as possible and afford some transition concessions if need be. In this case, 90 days notice would be, at a minimum, a reasonable notification period.

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