3 ms·

16 weeks of base pay - perhaps this is becoming industry standard for big company layoffs? (influenced by CA WARN act?) Interesting they are paying the cash eq

16 weeks of base pay - perhaps this is becoming industry standard for big company layoffs? (influenced by CA WARN act?) Interesting they are paying the cash equivalent of 6 months of healthcare, rather than just extending healthcare for 6 months.

dehrmann 4y ago
WARN Act is only 60 days, though.
- erehweb 4y ago
  Well sure. The 60 days acts as a lower bound. If it weren't there, then you'd see lower severance numbers.
thiscatis 4y ago
Perhaps group policies are annual with a true up / down later in the year and best to not renew and let them sort out their own policy?
daggersandscars 4y ago
In the US, (most) employers are required to offer former employees continued coverage via the COBRA (https://www.dol.gov/general/topic/health-plans/cobra https://www.dol.gov/general/topic/health-plans/cobra) program. COBRA compliance is built in to corporate insurance policies. Extending healthcare coverage via another method would require extra costs on the employer's part. Giving former employees the cash equivalent allows them to use COBRA if desired or to find alternative coverage.
- spit2wind 4y ago
  I don't think this correct. My understanding is that COBRA is a federal act to allow former employees (who meet certain conditions) to keep the same healthcare plan they had under their former employer. This is important because it preserves the amounts paid into the deductible, as well as the coverage. COBRA, as far as I understand, is not offered by the employer. It is a federal safety net. The employer has no monetary obligation whatsoever, besides those ruled by contract and conscience, to give the departed employee anything. Zero, zip, zilch. They are only obligated to pay out for work performed and anything required by contract, such as unused PTO. Again, that's it. At least in my state, the only other obligation is the employer must submit to another agency to handle COBRA (should you elect) within 30 days and that agency has 14 days to contact you. Reading between the lines, this has at least one serious flaw. Suppose you're let go on the 15th of the month and your former employer chooses to not continue your coverage. You then only have coverage until the end of the month. That's approximately 15 days. However, because the employer isn't obligated to submit to the third party for 30 days and they're not obligated to submit paperwork to you for another 14 days, it's potentially 34 days before someone contacts you about setting up continued coverage, or 19 days after your coverage ended. If the former employer doesn't provide you the name or contact info for the third part, you have to cold-call potential agencies in hopes that 1) they're the agency handling you and 2) the employer has submitted to them so that they know point 1. Good luck, hope nothing bad happens to you while you figure this out! I mention this because your post suggested that employers were required to do more. As far as I know, they're not. It's my contention (and experience) that, because companies tend to be tight fisted and short sighted, it has high probably for them to do only the minimum and to force former employees into the nightmare scenario. COBRA is also hella expensive. For one individual, expect to pay $450-500. For a couple, at least $1000. PER MONTH. Otherwise, check the marketplace. Already paid your deductible and let go in the first quarter? Too bad if you can't afford COBRA. You have to restart your contributions to the deductible if you opt for a new plan on the marketplace. So, make sure you're setting aside appropriately in when money's coming in. Apologies for the rantyness. This has happened twice, once during 2020 and again during the current rounds of layoffs. It hits home, hard. I think it's important for people's safety to make sure these facts are known.
  - daggersandscars 4y ago
    > I mention this because your post suggested that employers were required to do more I'm sorry my post suggested that -- it was not intentional. As you note, employers have no monetary obligations to former employees under COBRA. My intent was to offer a reason why Plaid, having decided to give employees money towards health care, would opt for cash vs extending the Plaid's existing policy to cover non-employees. Totally get the rantyness. My experiences with COBRA have not been great either and your points are good ones.
  - everybodyknows 4y ago
    If you're still unemployed when COBRA runs out, you'll need private health insurance. IIRC, this was about 50% higher than COBRA. In order to get it, you'll need a form from your former employer (or agent) certifying continuity of coverage. Expect the form to go missing, with persistent phone followup required. This based on my own FAMANG departure a few years back.
  - y-c-o-m-b 4y ago
    Oh I didn't know about the "inactive" days. I thought you could get reimbursed or request a delayed billing cycle so once you hop back on the COBRA plan, they'd retro-actively cover it. Is that not the case? I looked at the price for COBRA coverage for me and the family when I left my previous employer - $34,000 / year. Ouch.
    - gniv 4y ago
      There should be no inactive days. You typically have the same insurer, use the same card as when employed. For the first month you indeed get the paperwork later, so you pay late, but that's built into the system, it's mentioned in the exit paperwork.
- Bluecobra 4y ago
  Yeah that seems pretty generous to me. I was on COBRA for a short time and had to pay it completely out of pocket which was a huge sticker shock. I went from paying like $300/month to a $2,000/month for a family plan.
dragonwriter 4y ago
CA WARN Act is 60 days notice, and does not allow pay-in-lieu (you can keep people on payroll with full benefits but bo duties for the notice period, but that’s different than pay-in-lieu.) > Interesting they are paying the cash equivalent of 6 months of healthcare, rather than just extending healthcare for 6 months Given COBRA, that is practically the same thing, but gives the employee more choice (it also provides finality to the employer, who doesn’t keep a declining liability on the balance sheet, doesn’t risk having to deal with problems for the ex-employees payments after the one lump sum exit check, etc.)
- erehweb 4y ago
  Re not allowing pay-in-lieu, I guess that is correct, but this link implies that the penalty for not giving notice would be the wages, so the 60 days in-lieu would satisfy this - no room for extra damages https://california-business-lawyer-corporate-lawyer.com/employees-can-my-employer-pay-me-for-the-60-days-instead-of-sending-me-a-warn-notice/ https://california-business-lawyer-corporate-lawyer.com/empl... Admin burden of dealing with COBRA is non-trivial, so I would rather have the healthcare than the money.

dehrmann 4y ago

WARN Act is only 60 days, though.

erehweb 4y ago
Well sure. The 60 days acts as a lower bound. If it weren't there, then you'd see lower severance numbers.

thiscatis 4y ago

Perhaps group policies are annual with a true up / down later in the year and best to not renew and let them sort out their own policy?

daggersandscars 4y ago

In the US, (most) employers are required to offer former employees continued coverage via the COBRA (https://www.dol.gov/general/topic/health-plans/cobra https://www.dol.gov/general/topic/health-plans/cobra) program. COBRA compliance is built in to corporate insurance policies. Extending healthcare coverage via another method would require extra costs on the employer's part. Giving former employees the cash equivalent allows them to use COBRA if desired or to find alternative coverage.

spit2wind 4y ago
I don't think this correct. My understanding is that COBRA is a federal act to allow former employees (who meet certain conditions) to keep the same healthcare plan they had under their former employer. This is important because it preserves the amounts paid into the deductible, as well as the coverage. COBRA, as far as I understand, is not offered by the employer. It is a federal safety net. The employer has no monetary obligation whatsoever, besides those ruled by contract and conscience, to give the departed employee anything. Zero, zip, zilch. They are only obligated to pay out for work performed and anything required by contract, such as unused PTO. Again, that's it. At least in my state, the only other obligation is the employer must submit to another agency to handle COBRA (should you elect) within 30 days and that agency has 14 days to contact you. Reading between the lines, this has at least one serious flaw. Suppose you're let go on the 15th of the month and your former employer chooses to not continue your coverage. You then only have coverage until the end of the month. That's approximately 15 days. However, because the employer isn't obligated to submit to the third party for 30 days and they're not obligated to submit paperwork to you for another 14 days, it's potentially 34 days before someone contacts you about setting up continued coverage, or 19 days after your coverage ended. If the former employer doesn't provide you the name or contact info for the third part, you have to cold-call potential agencies in hopes that 1) they're the agency handling you and 2) the employer has submitted to them so that they know point 1. Good luck, hope nothing bad happens to you while you figure this out! I mention this because your post suggested that employers were required to do more. As far as I know, they're not. It's my contention (and experience) that, because companies tend to be tight fisted and short sighted, it has high probably for them to do only the minimum and to force former employees into the nightmare scenario. COBRA is also hella expensive. For one individual, expect to pay $450-500. For a couple, at least $1000. PER MONTH. Otherwise, check the marketplace. Already paid your deductible and let go in the first quarter? Too bad if you can't afford COBRA. You have to restart your contributions to the deductible if you opt for a new plan on the marketplace. So, make sure you're setting aside appropriately in when money's coming in. Apologies for the rantyness. This has happened twice, once during 2020 and again during the current rounds of layoffs. It hits home, hard. I think it's important for people's safety to make sure these facts are known.
- daggersandscars 4y ago
  > I mention this because your post suggested that employers were required to do more I'm sorry my post suggested that -- it was not intentional. As you note, employers have no monetary obligations to former employees under COBRA. My intent was to offer a reason why Plaid, having decided to give employees money towards health care, would opt for cash vs extending the Plaid's existing policy to cover non-employees. Totally get the rantyness. My experiences with COBRA have not been great either and your points are good ones.
- everybodyknows 4y ago
  If you're still unemployed when COBRA runs out, you'll need private health insurance. IIRC, this was about 50% higher than COBRA. In order to get it, you'll need a form from your former employer (or agent) certifying continuity of coverage. Expect the form to go missing, with persistent phone followup required. This based on my own FAMANG departure a few years back.
- y-c-o-m-b 4y ago
  Oh I didn't know about the "inactive" days. I thought you could get reimbursed or request a delayed billing cycle so once you hop back on the COBRA plan, they'd retro-actively cover it. Is that not the case? I looked at the price for COBRA coverage for me and the family when I left my previous employer - $34,000 / year. Ouch.
  - gniv 4y ago
    There should be no inactive days. You typically have the same insurer, use the same card as when employed. For the first month you indeed get the paperwork later, so you pay late, but that's built into the system, it's mentioned in the exit paperwork.
Bluecobra 4y ago
Yeah that seems pretty generous to me. I was on COBRA for a short time and had to pay it completely out of pocket which was a huge sticker shock. I went from paying like $300/month to a $2,000/month for a family plan.

dragonwriter 4y ago

CA WARN Act is 60 days notice, and does not allow pay-in-lieu (you can keep people on payroll with full benefits but bo duties for the notice period, but that’s different than pay-in-lieu.) > Interesting they are paying the cash equivalent of 6 months of healthcare, rather than just extending healthcare for 6 months Given COBRA, that is practically the same thing, but gives the employee more choice (it also provides finality to the employer, who doesn’t keep a declining liability on the balance sheet, doesn’t risk having to deal with problems for the ex-employees payments after the one lump sum exit check, etc.)

erehweb 4y ago
Re not allowing pay-in-lieu, I guess that is correct, but this link implies that the penalty for not giving notice would be the wages, so the 60 days in-lieu would satisfy this - no room for extra damages https://california-business-lawyer-corporate-lawyer.com/employees-can-my-employer-pay-me-for-the-60-days-instead-of-sending-me-a-warn-notice/ https://california-business-lawyer-corporate-lawyer.com/empl... Admin burden of dealing with COBRA is non-trivial, so I would rather have the healthcare than the money.