Employer guide
When employees can change a Section 125 plan choice
A benefit election is an employee’s choice of benefits. Employees usually make this choice before their coverage starts. If someone asks to change it during the year, check the written plan and the rules for that benefit before changing their pay.
See what your business could saveWhat can trigger a change?
Marriage, a new child, or a change in who can get coverage at work can allow some changes. The plan needs to allow the change, and the new choice often has to match what happened.
For example, a person gets married and wants to add their spouse to their health plan. Ask the plan administrator if the plan allows it and what date the new coverage and deduction should start.
Check the request in this order
- Ask which benefit they want to change and what happened.
- Confirm when it happened, the deadline to ask, and what records the plan needs.
- Check if the plan allows the change and when the new choice takes effect.
- Send payroll the approved amount and start date. Tell the employee what to expect on their next check.
Save a record of the decision
Keep the request date, old choice, new choice, and date it takes effect. If the rules are unclear or the request is late, ask the plan administrator before you change the deduction. Different benefits can have different rules.
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