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Regular Non-Benefits Eligible Employee Process Frequently Asked Questions The following FAQ’s answer questions about changes to the total allowable hours a regular non-benefits eligible employee may work in an anniversary year. These employees become eligible for the University’s defined contribution and defined benefit plans if they work 1000 hours or more within a year from the anniversary of their initial date of hire. UHRM is committed to helping supervisors and managers track and monitor regular non-benefits eligible employee’s hours worked and will play an active role in providing managers with an hours worked summary per employee at approximately 500 hours and 800 hours worked. What is changing and why should I be concerned? Regular non-benefits eligible employees cannot work for the University for more than 1000 hours within one year of their anniversary date. When 1000 hours are exceeded, the non-benefit eligible employee will become eligible for the University’s defined contribution and defined benefit plans. Allowing the employee to participate in the plans will impact the department’s budget since the full fringe benefit rate will be applied. Currently the fringe rate for non-benefits eligible employees that do not work greater than 1,000 hours in a twelve month period is 8.6% for FY08-09. If a regular non-benefits eligible employee works 1,000 hours or more in a twelve month period the full fringe non-Federal rate of 22.3% in effect for FY08-09 will be charged to the unit. UHRM is committed to helping supervisors and managers track and monitor regular non-benefits eligible employee’s hours worked and will play an active role in providing managers with an hours worked summary per employee at approximately 500 hours and 800 hours worked.
Why has this change occurred?
Beginning with the 2009 plan year and each year thereafter, the University’s 401(a) and 403(b) retirement plans will be audited annually by an independent accounting firm. Among other things, the auditors will ensure that employees are enrolled in the plans at the appropriate time. Although employees may be excluded from other benefit programs if they are classified as "benefits-ineligible," they must be enrolled in the retirement plans if they complete 1000 hours of service during the 12-consecutive month period beginning on their hire date (and each anniversary thereafter). Accordingly, it is imperative that we monitor the hours worked by our benefits-ineligible staff to be certain they do not exceed the 1000 hour threshold. What does this mean when I hire a new regular non-benefits eligible employee?
UHRM is committed to tracking the number of hours a regular non-benefits eligible employee works throughout his/her anniversary year. The Temporary Pool Administrator will track the number of hours regular non-benefit eligible employees work and will provide supervisors/managers with two notifications that will inform the manager/supervisor of the hours a regular non-benefits eligible employee has worked. Keep in mind that a temporary employee may have worked for another department/ division of the University prior to his/ her assignment with the current department. The hours worked on the previous assignment will be subtracted from the total allowable hours. What hours are included in the 1,000 hour limit?
All hours reported on a timecard are included, for example, hours worked and other paid absences (OAP). What will happen when my regular non-benefits eligible employee reaches 1000 hours?
The current regular non-benefits eligible employee MUST stop working until their next anniversary date or they will become eligible for the University’s defined contribution and defined benefit plans. What happens if my regular non-benefits eligible employee exceeds 1000 hours?
If your regular non-benefits eligible employee works more than 1000 hours during his/her first 12 months at the University, he/she will be automatically enrolled in the appropriate retirement plan(s) after completing 12 months of service. If the employee works more than 1000 hours during any subsequent 12-month period following the employee’s anniversary date (but does not during the employee’s initial 12 months of employment), he/she will be enrolled in the appropriate retirement plan(s) at the end of that 12-month period. Once enrolled, payroll deductions will be taken from the employee’s paycheck for the appropriate defined contribution plan (ERIP-DC or CRP). How does this impact the regular non-benefits eligible employee? When the employee meets the eligibility requirements for the Retirement Income Plan for Employees (ERIP), the regular non-benefits eligible employee will have deductions taken from their paycheck for ERIP and Long Term Disability (LTD). The regular non-benefits eligible employee will not be permitted to un-enroll in either plan as long as they are employed by the University. Where can an employee find out more information about ERIP and LTD?
Summary Plan Descriptions for both benefit plans are located on the Benefits Website at http://hr.uchicago.edu/benefits/spds/. How do I hire a regular non-benefits eligible employee? The hiring process, as bulleted below, will remain the same, however, an additional notification from Employment Services will notify managers/supervisors of the number of hours an individual is eligible to work.
May a regular benefits eligible employee return to the University as a regular non-benefits eligible employee?
Yes. A former regular benefits eligible employee may return as a regular non-benefits eligible employee but will be eligible for the University’s defined contribution and defined benefit plans at the appropriate fringe rate upon hire.
How will I know when my regular non-benefits eligible employee reaches the maximum hours? UHRM will send two email notifications; one at approximately 500 hours worked and a second notification at approximately 800 hours worked. The email will inform managers/ supervisors of the number of hours worked. Upon receiving the second notification of hours/ weeks worked, supervisors/ managers must make a decision to either: 1) end the regular non-benefits eligible employee’s assignment at the end of the maximum allowable hours worked; 2) decrease the number of hours the employee works for the remainder of the employee’s anniversary year to not exceed 1000 hours; 3) not allow the employee to work until after their next anniversary year begins; or 4) post the position on UChicago Jobs to begin the recruitment process to hire a benefits eligible employee.
What options do you have for maximizing the number of weeks a regular non-benefits eligible employee may work? To maximize the number of weeks a regular non-benefits eligible employee works, consider the number of hours you need an employee to work on a weekly basis. Doing so will enable supervisors and managers to fully maximize the 1000 hours limit.
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