Eligibility rules in the handbook must match the plan, or the plan wins.
When handbook eligibility rules differ from the plan document, the employer risks disputes, coverage errors and penalties. The Affordable Care Act adds full-time employee rules to the mix.
What the rule says.
General reference material, not legal advice. Eligibility and plan-document rules change, so check the up-to-date wording.
Eligibility Must Be Written in the Plan
The summary plan description must describe eligibility conditions, and the plan terms control, so the handbook should not create separate rules.
ACA Full-Time Definition
Large employers face penalties if they do not offer coverage to full-time employees, generally those averaging 30 hours per week.
Classification
Worker classification affects who is eligible.
How it plays out.
Pull eligibility language from the plan document, then align the handbook by reference.
Check for gaps: part-time, variable-hour, seasonal and rehire situations.
Apply the eligibility rules the same way to everyone, since uneven enrollment practices can lead to disputes. This text is for general orientation, not a legal opinion on your plan.
Where this shows up in your plan.
Waiting Period
Align the waiting period with the plan and the 90-day maximum.
Hours Tracking
Track hours for variable-hour employees using a measurement method.
Plan Amendments
Amend plan documents before changing eligibility.
Setting it up.
Compare handbook and plan eligibility.
Fix conflicts by referencing the plan.
Review ACA measurement methods.
Check classification of contractors.
Train HR on consistent enrollment.
Mistakes to avoid.
Do not promise eligibility the plan does not provide.
Do not forget part-time and variable-hour staff.
Do not change eligibility without amending the plan.
Do not treat rehires inconsistently.
Other rules employers work with.
ACA Compliance for Employers
Full-time rules.
Worker Classification and Benefits
Who is eligible.
Handbooks, Arbitration and Policies Guide
The core handbook guide that this eligibility page supports.
Laws and Rules Referenced
Section 4980H of the Internal Revenue Code (26 U.S.C.) — The offer-of-coverage test that depends on who counts as full time.
29 CFR 2520.102-3 (SPD content regulation) — Where eligibility and participation terms must appear in the SPD.
Waiting period limit, 42 U.S.C. 300gg-7 — No eligible employee waits longer than 90 days for coverage to begin.
Quick answers.
Questions on eligibility rules, waiting periods and matching the handbook to plan documents, with deeper guides linked.
Which controls, the handbook or the plan?
The plan document controls.
Who counts as full-time under the ACA?
Generally an employee averaging 30 hours per week.
Can the handbook add an eligibility rule?
Only if the plan document also provides it.
More guides in this series.
At-Will Employment and Handbook Disclaimers in Michigan
A companion guide in the same series.
Required Handbook Policies and Notices for Michigan Employers
A companion guide in the same series.
Employment Arbitration Agreements and Class Waivers in Michigan
A companion guide in the same series.
Why an Employee Handbook Is Not a Summary Plan Description
A companion guide in the same series.
Handbook Leave Policies and FMLA, Michigan Sick Time and Military Leave
A companion guide in the same series.
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