Waiting Period for Employer-Paid Benefit

[insspecinc]

I have a group ancillary LTD policyholder (100% employer paid) that allows new hires to enroll only on the plan anniversary. The inforce carrier allows this to occur but I wonder about the discriminatory aspect. In other words, if the group has a June 1 effective/renewal date and they hire someone May 15; the employee would go on the plan about 15-days later. At the same time if they hired someone on June 2, that employee would have to wait almost a year before being eligible for the same benefit. This does not sound fair and thus the discrimination question.

Can anyone provide me with feedback or guidance here that I can provide the client?

David M. Block, CLTC

President
Insurance Specialties, Inc.
PO Box 1809
Candler, NC 28715-1809

800.358.8844 toll free
828-667-1119 local
828-667-2229 fax
www.insurance-specialties.com

[lvena]

Without reviewing any documents, I would say that this is ok. As long as the employer has a written policy outlining the time period, has communicated it to the employees, and has followed it, there should be no discrimination issue. The discrimination issue would arise if the employer did not follow it for all, for example, if with a new hire the employer allowed that person to come on quicker.