Questions about Resigning

[Al Iglesias]

What is the name of your state?What is the name of your state?What is the name of your state?What is the name of your state? FL

Hello to all and a special hello to Beth (Really need you guys on this one)

For the past 12 years I have run a Quickbooks Accounting Software Training company pretty much by myself as Owner. About 3.5 yrs ago I was offered a position of Controller for one of my clients which I took. I have been working Monday, Wednesday and Friday's while supporting and training my clients on the other days to include Saturdays. They basically pay me 54,600 annually for the three days and I am now ready to move on, as my business has really taken off. I receive medical benefits of 60% for my portion and 40% for my dependents. They have a 401k plan which they match 25% for among other benefits, that I will need to setup as last week I took the plunge and finally incorporated my company API Resource, Inc.

I am writing up a resignation letter and wanted to get the forum's thoughts on going from employee status to what I will propose to be a 1 day a week subcontractor position as I train or assist in the training of the new employee. This German company has a total of 10 employees. Do you think I might be able to retain a pro-rated share of benefits until I leave which can be a month or more? I helped start this company in the US. Your thoughts. Or should I ask to retain employee status for 1 day? Need you help crew. Many thanks. Al in Tampa.

 

[Beth3]

Do you think I might be able to retain a pro-rated share of benefits until I leave which can be a month or more? I'd guess no, Al. I seriously doubt anyone working only one day a week would meet the criteria as an eligible employee in the Plan Documents that describe the group health and retirement plan. Those typically state the minimum number of hours an individual must regularly work in order to participate.

The specific terms vary from Plan to Plan but a typical eligibility statement will read something like: "An eligible employee is one who has been employed for 90 days and regularly works 40 hours per week."

Whether you want to stay on the payroll as an employee or whether you want to work as an IC for the company I'd imagine will depend on how you want your taxes handled, i.e. whether or not you want taxes withheld from your wages.

 

[Al Iglesias]

Resigning

Thanks Beth. I thought that would be the case. I should have know better. Actually last night I was writing a letter and bumped it up to 2 days but I think the criteria for the medical is 25 hrs in our plan and I don't plan on working 12.5 hrs per day. So I guess, I have am probably better off just resigning in normal fashion and giving them 2 weeks and stay 3 days a week or become a sub immediately and decide how many days a week. They need me right now as I am the only one handling financial matters, so I don't want to leave them hanging and I think they will keep me during this time. Well wish me luck. Thanks.

Al

 

[cbg]

Al, although your company is too small to be subject to Federal COBRA, your state, surprisingly considering how few employment laws Florida has, does have a state continuation plan for employers of under 20 employees. As long as you have been covered under the plan for three months, it is triggered by the termination of your hospital, surgical or major medical plan for any reason. Your employer should be able to give you more information.

 

[pattytx]

One other thing, Al. If you are going to be doing the same type of work you were doing as an employee, including training the new employee, at the least, the IRS would still consider you an employee, not an independent contractor. You can check out a discussion of IC vs. employee at:
http://www.irs.ustreas.gov/businesses/small/article/0,,id=99921,00.html