UPS Changes Employees’ Spouses’ Healthcare Coverage Because of Affordable Care Act

Employees at United Parcel Service (UPS) will not be able to receive healthcare benefits for working spouses who are eligible for coverage through their own employers, according to recent reports. UPS stated that it made this change because of rising costs caused by the Affordable Care Act.  This change is an example of ways that employers might attempt to lower costs under the new healthcare law.  However, employees should be aware of changes that might subject them to harassment, retaliation, or discrimination.

New Employee Benefit Policy

A spokesman for UPS stated that the company’s new policy is part of an effort to keep employees’ healthcare premiums from rising above current levels.  Importantly, the change would only apply to working spouses who are eligible for healthcare through their own employers.  UPS stated that the new policy was based on the fact that the Affordable Care Act requires all employers to provide health coverage to their employees, including working spouses of UPS employees.  When the change goes into effect on January 1, an estimated 15,000 to 33,000 spouses will be dropped from coverage for medical benefits, though they will still be eligible for dental and vision benefits.

Legal Ramifications?

However, according to a study done by two law professors at the University of Illinois, the Affordable Care Act might cause employers to make changes that could be unfair to employees or could even amount to harassment or discrimination.  One of the possible changes that has received the most press is that employers might slash employees’ hours so that they are not full-time employees who must be covered.

Another potential employer action might lead to discrimination against some employees.  Employers might start asking employees or prospective employees about their plans for healthcare coverage.  Employees who will receive healthcare coverage through a spouse might receive preference over employees who intend to seek coverage through their employer.

Another possibility is that employers may retaliate against employees who subject them to fines under the Affordable Care Act.  Employers will have to pay fines under the healthcare law if they do not provide coverage to employees or if they provide inadequate coverage that causes employees to purchase subsidized healthcare through the state.  Therefore, if an employee purchases healthcare through the state because an employer’s healthcare coverage is inadequate, that employer may face fines under the healthcare law and might retaliate against that employee.

The Bottom Line

The new healthcare law may cause employers to change their practices in order to keep costs down.  However, employees should not have to face harassment, retaliation, or discrimination based on the new healthcare law.  It is possible that unfair practices could lead to an employment lawsuit or other legal measures.  If you would like to learn more about this issue, feel free to contact an employment lawyer for information or advice.