Paychecks may look a little different in February for benefits-eligible employees who are paid biweekly.
Instead of having insurance deductions taken out of either the month’s first or second paycheck, all insurance deductions will be split evenly between the two. With this change, paychecks may be more even; the first biweekly check each month may be smaller and the second check may be larger than in the past.
The mandatory change affects approximately 2,700 employees, or about one-third of the university’s staff. There is no opt-out.
Employees who are paid monthly, are not benefits eligible or are overtime exempt will not be affected.
The change comes as a result of increased health insurance premiums coupled with smaller paychecks due to the state-mandated furlough days.
Human Resources employees first became concerned about the health insurance check deduction over a year ago, when they noticed that some biweekly employees’ family health insurance deduction took up most of their check.
“The primary reason for making this change was to make sure people could choose their health plans,” said Lydia Lanier, senior director for the financial management and education center (formerly employee benefits) in Human Resources. Some employees were basing their choice in health plan on what their checks could support, she added.
The Staff Representative Group for the Finance and Administration division also asked for the deduction change after receiving complaints from workers.
“When our lowest paid employees make $21,000 a year, insurance can take up a significant portion of their paycheck,” said Amy Thomas, a senior accountant in auxiliary services who was part of the group that asked for the change. “We serve as the division’s voice to the upper administration and thought that splitting the deductions evenly would be a way to help people out.”
Thomas said that most feedback about the change had been positive so far, and that the only issues had to do with personal budgeting.
Human Resources worked with the payroll department and EITS for more than a year to coordinate the change, which Lanier described as complicated. She said it required a major programming change for payroll.
Previously, health insurance deductions for employees paid every other week had been taken out of the month’s second paycheck with other deductions, including dental and life insurances, taken out of the first paycheck. Effective with the first paycheck in February, health, dental, life, accidental death and dismemberment, long-term disability, short-term disability, long-term care critical illness, accident and cancer insurance all will be split to the nearest penny and taken out of each check. If there are more than two pay periods in a month, these deductions still will be split between the first two checks and will not be taken out of the third.
Under the new plan, an employee previously paying $440.60 out of one check for the family PPO plan will now pay $220.30 from both monthly checks. Similarly, an employee paying for employee-only dental insurance would pay $14.16 and $14.17 out of each check, instead of $28.33 out of one check. Other non-insurance deductions, including parking, will not change from the current system.
