If I have employer paid family healthcare insurance coverage, can employer stop paying for this benefit?

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If I have employer paid family healthcare insurance coverage, can employer stop paying for this benefit?

I have worked for a credit union for over 19 years. All full-time employees get employer paid health insurance. 10 years ago, in lieu of an annual pay increase, my employer agreed to provide employer paid family health insurance. Now employer says it cannot continue to pay for family coverage. They are offering to increase my pay only a fraction of the current family insurance premium amount. Can they unilaterally make this change? Do I have to accept their offer take it or leave it?

Asked on August 25, 2017 under Employment Labor Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

Yes, they can stop providing this, and they don't need to offer you *any* increase at all--they are being more generous than required if offering you a small increase. Quite simply:
1) The law does not mandate health coverage: employers are free to not offer it, even if in some cases, under the ACA, they may face penalties (they could choose, if they do face a penalty, to pay it rather than provide insurance).
2) Employers are free to change compensation or even reduce it at all, unless you have a still-in-effect (unexpired) written employment contract for a defined or set term (e.g. a one-year, two-year, etc. contract) which, by its plain language or provisions, guarantees you certain compensation. Since health care is part of your compensation, this can be changed or reduced at will.
3) It doesn't matter how long you had certain benefits or compensation: in the absence of a contract, it may be changed (or reduced) at will.
So your employer can take away your health insurance either without any additional compensation or with whatever additional pay/compensation they choose, and your only option is to either accept the change or seek another job.


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