Employer failed to pay premiums

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Employer failed to pay premiums

My employer failed to pay the premiums on our health insurance, even though he took the money out of our paychecks (employees pay 40%). Our insurance is in danger of being canceled in the next few days and I want to know what my rights are as I found out today I need surgery and now I might not have insurance.

Asked on June 1, 2009 under Insurance Law, Michigan

Answers:

B. B., Member, New Jersey Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

I think you and the rest of the employees ought to hire an attorney, right now, to try to go into court to get the premiums paid.  It's rare that the courts act that quickly, but you should look into the possibility.  This is absolutely not something for a non-lawyer to attempt!

It's a violation of the wage and hour laws to take something out of your paycheck, and not use the money for the stated purpose.  The trouble is, you need action quickly, and that means not only starting the case quickly, but asking the court to do something quickly, to prevent "irreparable injury" by allowing the health insurance to lapse.

This kind of lawsuit is expensive, although if you win, the employer may have to pay the bill.  But since you have a number of people who will all have the same complaint, differing only in amounts, it should be able for one attorney to represent all of you in one lawsuit -- at the worst, you share the lawyer's fee with everyone else.  One place to find qualified attorneys is our website, http://attorneypages.com

L.M., Member, California Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

I would contact an attorney right away in your state.  If you paid your premiums and your employer failed to do so, putting your insurance at risk of being canceled, you might have a case against your employer.  In the mean time, contact the insurance company and find out what they intend to do regarding coverage for the employees of this company.  Perhaps they can reinstate (if they've canceled) at the COBRA rate for the time being until this is all straightened out, so you don't go without any coverage at all.


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