Hour Bank Program Options
Protect your hourly employees for as little as $1.12 per hour. Contact us to get started.
What is an Hour Bank
If you have seasonal, contract or project employees you may wish to cover them under an Hour Bank plan. An Hour Bank is a method of providing health insurance benefits to those who do not work consistent hours year round. By accumulating hours in the employees Hour Bank, employees continue to receive benefits while they are not currently working, until they have “spent” their banked hours.
August:
John works 160 hours. He has to work at least 150 hours to receive benefits next month. He works 10 more than needed, so those 10 hours are saved for the future. (benefits = 150; 160-150=10) receives benefits next month.
September:
John receives benefits this month since he worked the required 150 hour minimum in August. This month he works 220 hours. 150 of those hours go toward benefits in October and he gets to add 70 hours to the 10 he had saved up previously for a total of 80 hours.
October:
John continues to receive benefits since working the required 150 hours the month before. This month he works 150 hours and carries forward the same 80 hours he previously banked.
November:
John gets lucky this month and works 220 hours. He’s worked well beyond the 150 hour minimum, which saves him 70 more hours, plus he already had 80 hours banked from previous months giving him a grand total of 150 hours banked.
December:
John’s not so lucky this month. It’s winter, so conditions for John’s work are not ideal. He doesn’t pick up any contracts this month. But thankfully he still has benefits because he was able to bank 150 hours from previous jobs. That’s the beauty of Hour Bank.
How it works
Every hour worked is a step closer to a month of benefits. Benefits are provided to the employee per month at a “cost” of 150 hours. The benefits begin the month after the employee has accumulated 300 hours. Hours worked each month in excess of 150 hours will be stored for times when the employee does not work the required 150 hours. That helps the employee prepare for any life emergencies, while helping you build rapport so that they will work with you again.
Employers have the option to pre-pay the required 300 hours in order to receive benefits from the start. Every hour the employee works during the on-season is banked as benefits for when the employee is not working, whether that’s due to the end of a contract, end of season or other similar reasons. Every 150 hours banked is equivalent to one month of benefits.
Hour Bank is an employer-paid plan. Our supplier, D.A Townley, issues a T4A to all eligible employees for Life Insurance, Dependent Life Insurance, and the Accidental Death and Dismemberment insurance premiums, which are taxable benefits to the employee.
The Fine Print
- Employees can bank a maximum of 750 hours
- Life, Dependent Life and AD&D terminate at age 70
- Long-Term Disability terminates at age 65
- Extended Health Care, Vision Care and Dental Care terminate at age 85
