Employer Kept Insurance Payments

[mitchell1204]

What is the name of your state (only U.S. law)? Tennessee

Hi, I am a long haul truck driver. I have been paying for critical care, short and long term disability insurance through payroll deduction. Last month due to health problems the DOT medical doctor disqualified me from driving. I am at home on a medical leave of absense and still considered employed.

I filed for short term disability through the insurance provider. My claim was denied due to the policy was lapsed. After checking with the insurance company, my employer has not made a payment since November 2009.

Since the human resourse dept is just one lady, I am specualting embezzlement is going on. My 401K and health insurance has been maintained. But not many, if any file disability. It would be very easy to take that money unnoticed. I highly doubt it's been overlooked for one year. I have my paystubs showing the deductions to date. The policies are for for $1500/mo. benefit each and the cost I pay is around $100/mo.

The owner of the company is a successful business owner with multiple companies in multiple states. He is based in Minnesota. The company I work for was based out of Nebraska and Jan 2010 moved into the terminal in Illinois. Yet the Nebraska office is supposingly closed, they continue to use that address. I know they still pay Nebraska unemployment insurance because I checked that option. I think they are still in the process of slowly transferring to Illinois but have not done everything yet.

What should I do? If I need to file a lawsuit, what state?
They got me in a financial gridlock and I'm exhausting all savings. I'm about to take a 401K hardship which I don't want to do.

Any advice would be greatly appreciated. Thank you in advance.

 

[cbg]

You contact the US DOL - they are the regulatory agency for ERISA violations, which is what this is. However, I would not make any accusations of embezzlement; just tell them that you have had payroll deductions taken for an insurance policy that has been cancelled for non-payment. Let THEM make the determination as to where the money is going and why. It *could* be a clerical error. I've seen worse. It also *could* be exactly what you think, but that's neither your call to make nor mine. Let those whose job it is to investigate make the decision.

It also wouldn't hurt for you to contact the state insurance commissioner. Start with the commissioner of your own state - if he feels it should be managed by another state, he'll tell you.

 

[mitchell1204]

Thanks! What about my loss of benefits though?

 

[cbg]

It will be up to the DOL to determine whether the employer is required to pay out the benefit, or to return your premiums. However, I would not count on the former - it is far more likely to be the latter.

 

[mitchell1204]

That don't seem fair. Anytime an employer makes a mistake or has criminal intent, it's okay for the employee to suffer. I was under contract of paying premiums and working in exchange for a disability policy and having peace of mind. It seems like breach of contract to me. Someone else told me I could sue for "benefit of the bargain", what I would have received from the insurance company.

You don't think it's in my best interest to seek an attorney?

I'll follow up with what you recommended so far. I am going to wait until I get my 401K money next week. Because I have to go through the same lady to get it. I'm 49 yrs old and never sued anyone before. I'm not sue happy and I'm totally naive to the process.

 

[cbg]

I think you may have a hard time showing that you had a "contract" for disabilty insurance. But by all means consult an attorney if you would prefer. He may see something I don't.

Just be aware, there are only five states where it is required by law that an employer provide disability benefits, and none of the states you have mentioned are among those five.

 

[mitchell1204]

Looking at the USDOL websites FAQ disability insurance does not fall under ERISA. ERISA is retirement plans. Please correct me if I'm wrong.

Question: What is the role of the U.S. Department of Labor in regulating pension plans?

Answer: The U.S. Department of Labor enforces Title I of the Employee Retirement Income Security Act (ERISA), which, in part, establishes participants' rights and fiduciaries' duties. However, certain plans are not covered by the protections of Title I. They are:
Federal, state, or local government plans, including plans of certain international organizations.
Certain church or church association plans.
Plans maintained solely to comply with state workers' compensation, unemployment compensation or disability insurance laws. Plans maintained outside the United States primarily for non-resident aliens.
Unfunded excess benefit plans - plans maintained solely to provide benefits or contributions in excess of those allowable for tax-qualified plans.
The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) is the agency charged with enforcing the rules governing the conduct of plan managers, investment of plan assets, reporting and disclosure of plan information, enforcement of the fiduciary provisions of the law, and workers' benefit rights.

 

[pattytx]

ERISA also regulates tax-preferred insurance plans, such as medical and dental.

 

[cbg]

It says that they do not regulate laws put into place to comply with state disabilty laws. Your state(s) do not have any such laws. Which I have already told you.

But if you don't want to go to the DOL, don't. Your subsequent postings are making it clear that you don't want to be given an answer to a free resource such as a regulatory agency; you want someone to give you permission to sue your employer. So fine. Hire a lawyer and do that. I'm finished here.

 

[mitchell1204]

No I care about suing anyone. I'm just trying to find out answers. You say one thing and the DOL website has a Q&A on ERISA saying they don't handle disability claims.

I'll seek answers somewhere else. You evidently have issues and a short fuse.

 

[cbg]

No, that is NOT what it says. But fine, you go somewhere else. I'm sure that somewhere you will find someone who will give you the answer you want to hear.