Common use of Alternate Benefits Clause in Contracts

Alternate Benefits. An alternative benefit in the form of a cash payment is available to those full-time employees in regular or probationary status who: (1) elect to opt-out of receiving City contributions under section 6.02 and 6.03; (2) are not enrolled in a City- sponsored health insurance plan as the dependent of another City employee; and (3) provide proof of medical insurance coverage from a plan other than a City-sponsored plan. Any cash payment provided under this section shall be reported to the Internal Revenue Service (IRS) and the California Franchise Tax Board as compensation subject to income tax withholding. Each employee shall be solely and personally responsible for any tax liability that may arise out of receipt of the alternative benefits provided under this section. The amount of alternative benefit provided to an employee is based on the level of insurance coverage that employee could have received if he or she had enrolled in a City-sponsored health insurance plan. Effective July 1, 2013, the amount of the alternative benefit provided under this section shall no longer increase with the growing cost of health care, and as such, shall be frozen at the 2013 Bay Area Basic Kaiser health plan premium rates (i.e. $668.63 for employee only, $1,337.26 for employee and one (1) dependent, $1,738.44 for employee and two (2) or more dependents. Each employee shall be responsible for providing immediate written notification to the Human Resources Director or designee of any change to the number of dependents which affects the amount of the City’s payment to the Alternative Benefit Account. An employee who, by reason of failing to report a change in dependents, receives a City payment greater than the amount to which entitled shall be liable for refunding the excess amounts received via a reduction in the amount paid to his/her Alternative Benefit Account. Changes to benefit payments required because of a change in an employee’s number of dependents shall take effect at the start of the first pay period in the month next following the month in which advice from the employee is received by the Human Resources Director. No retroactive increases to the City’s payment shall be allowed. Enrollment in alternative benefits has to be elected each year during open enrollment.