I work for an S-Corp owned by two men. They have the company pay for their health insurance premiums and make their employees pay in full out of their own pockets for their own. Is this legal?
2007-01-18 05:41:44 · 6 answers · asked by eah2601 2 in Business & Finance ➔ Insurance
Maybe. An S corp can have different 'classes' of employees. THey could say, ok, we pay for all class a employees, but class b employees have to pay in. Or, they could pay for all "exempt" or salaried employees, but not hourly employees (this is VERY common).
Or, they could be doing something illegal. Check your employee handbook, to see what class of employee qualifies. Or maybe just find another job, as you don't seem to trust your current employer to be doing right by you.
2007-01-18 06:30:26 · answer #1 · answered by Anonymous 7 · 0⤊ 0⤋
Yep, it's legal. Companies don't have to provide benefits for their employees, and if they require the employee to pay into it, that's perfectly legal. They can pick and choose a level of employee (say, manager over associate) on the company hierarchy where the company picks up the cost.
2007-01-18 06:45:32 · answer #2 · answered by zippythejessi 7 · 0⤊ 0⤋
Yes, it is legal. However, if the benefit (health insurance paid by the company) is not available to all employees, then the benefit they receive is considered taxable compensation to them. Therefore if the company is paying for the health insurance for the two shareholders, but the rest of the employees have to pay for their health insurance themselves, then the value of the health insurance for the two shareholders is considered taxable compensation to those shareholders.
2007-01-18 05:50:47 · answer #3 · answered by jseah114 6 · 0⤊ 0⤋
One more thing. You don't say whether you are paying for an individual policy or you are paying in full on the same policy that your employers are on. In California, all carriers under a "group" plan contract require the employer to pay for at least 50% of the lowest cost plan available. Which means they should be paying something if you are on a "group" plan with that employer. Check the state regs.
2007-01-19 11:15:45 · answer #4 · answered by Brian D 1 · 0⤊ 0⤋
It is legal to my knowledge. As the employer, they are only required to pay FUTA taxse, Social Security and Medicare, as well as withhold FIT and SIT. Paying health insurance is a benefit, not required by law.
2007-01-18 05:51:00 · answer #5 · answered by Shannon L - Gavin's Mommy 6 · 0⤊ 0⤋
He does not have to pay for your health insurance and he
can have the company pay for his....
2007-01-18 05:49:46 · answer #6 · answered by Anonymous · 0⤊ 0⤋