Do Benefits Continue During Furloughs?

It’s a Matter of Plan Interpretation

by Steven Schinderle, Principal, Mercer Health

As a growing number of states implement actions to limit the spread of COVID-19, some employers are weighing the need to take some type of workforce action. Which path to take will depend on the organization’s unique situation, and it’s critical to understand the important consequences of each for your workforce strategy. In this article, we’ll focus on furloughs versus layoffs in terms of the impact on continuation of benefits coverage.

Generally, layoffs result in a termination of employment and a loss of benefits. That will trigger benefit continuation requirements like COBRA for health benefits and conversion and portability for some insured employee paid benefits. In contrast, a furlough is a temporary unpaid leave from work, usually for a set period. Furloughed employees may remain eligible for health and other benefits coverage. You’ll need to dig out those plan documents to confirm.

Want to read more? You can continue reading the article here.

Get the latest insights from Mercer’s US Health News.

Originally published at https://www.mercer.us on March 26, 2020.