Leaving Employment - Impact on Benefits for Benefited Employees
Leaving Employment - Impact on Benefits for Benefited Employees
This webpage provides benefited University employees who are leaving employment for reasons other than retirement with a high-level overview of the impact on various fringe benefits. Neither this webpage nor embedded documents are intended to be comprehensive. More detailed information regarding the laws, policies, bargaining agreements, etc. on which benefits are based is available from Human Resources. In case of questions or conflict between the information in this document and the actual laws, policies, bargaining contracts, etc., the latter will prevail.
Information provided on this webpage is also provided in the Impact of Leaving University Employment on Benefits document.
Individuals who wish to apply for a pension from the Massachusetts State Employees’ Retirement System (MSERS, pension system, defined benefit plan) or the Massachusetts Optional Retirement Program are encouraged to access the corresponding webpages as the impact of retirement on benefits may differ.
Massachusetts Group Insurance Commission (GIC) Coverages: You may continue your coverage with some limitations on time and/or benefit levels in one of the following ways:
- 39 Week Layoff Coverage - for health and life insurance coverages. If you are laid off from University employment you may continue your health and life insurance plans by paying 100% premium for 39 weeks after employment ends. Thereafter you may extend your health insurance coverage at 102% premium for the balance of the 18 months total health coverage permitted by COBRA.
Benefit: Allows you to keep your health and life insurance plans for 39 weeks (and the entire 18-month COBRA period).
Drawback: You pay 100% of the premium for your insurance coverage(s). Maximum coverage period is 18 months.
- COBRA - for health insurance only. The GIC will mail a COBRA notice to your home (also available on-line from the GIC www.mass.gov/gic). To enroll you must complete and return the COBRA enrollment form within 60 days of the GIC issuing the COBRA notice to you. If you enroll in COBRA coverage will be retroactive leaving no break in coverage.
Benefit: Allows you to stay in the same health and GIC Dental/Vision plan with the same group benefits.
Drawbacks: You pay 102% of the premium. Maximum coverage period is typically 18 months.
- Convert to Non-Group health insurance coverage with your current health plan (contact your Plan to determine if coverage will be offered):
Benefit: You may keep coverage indefinitely as long as you pay the premium.
Drawback: Benefits are almost always less comprehensive than GIC coverage and costs are higher. There is no guarantee that your health insurance company will provide you the option to convert coverage to a non-group plan.
- Commonwealth Health Connector health coverage (contact the Health Connector Authority for information and enrollment: www.mahealthconnector.org, 1-877-623-6765):
Benefits: A choice of health insurance options with different benefits and prices. Depending on which plan you choose, your monthly premium for the Health Connector could be lower than the monthly premium for COBRA or conversion coverage. Unlike COBRA coverage, Health Connector coverage does not have a maximum coverage period. You can continue coverage as long as you pay your premiums on time.
Drawbacks: Benefits may not be as comprehensive as the coverage you had through the GIC. If you enroll in Health Connector coverage, you are waiving your right to elect health insurance under the GIC's COBRA or conversion options. This option is available for Massachusetts residents.
MA Group Insurance Commission Life Insurance
You may be eligible to continue your MA Group Insurance Commission (GIC) life insurance under a portability option or to convert coverage to a non-group rate. Please contact the GIC's life insurance vendor to explore these options.
Deferred retirees (those who have vested in the Massachusetts State Employees' Retirement System (MSERS/pension system) or have ten or more (10+) years in the Optional Retirement Program (ORP/defined contribution plan) and leave their funds in MSERS or the ORP may continue coverage consistent with the plan contract. Information is provided on MetLife's GIC website and handbook.
MA Group Insurance Commission Long-Term Disability Insurance (LTD)
Your Massachusetts Group Insurance Commission long-term disability insurance coverage ends upon employment. However, your departure from employment does not impact your eligibility to draw income from your LTD plan if you were disabled prior to leaving University employment and your claim is approved by MetLife (the GIC’s LTD provider.)
Dental insurance coverage typically continues through the end of the month following departure (eg if employment ends during November coverage continue through end-of-day December 31). Your dental plan administrator will mail a notice to your home offering extension of coverage for up to eighteen (18) months under COBRA at the cost of 102% premium. If you wish to continue your coverage you must return the COBRA enrollment forms and premium payments directly to the plan administrator. If you are retiring from MSERS or the ORP you are also eligible to enroll in the GIC retiree dental plan (www.mass.gov/gic). COBRA premiums are not deducted from retirement payments, GIC Retiree Dental plan premiums are.
Dental insurance coverage (and plan administrator) differ based on bargaining unit. For individuals in a position covered by:
- AFSCME, PSU/MTA
MA Public Employees’ Fund
Tel: 800.325.5214, 617.426.4440
- USA/MTA, MSP/MTA and benefited Non-Unit positions
Health Plans, Inc
Tel: (888) 401-3539
Insurance Administrators, Inc.
Paid Leave Accruals
Unused vacation time is paid in one lump sum, typically 1-1.5 months after employment ends. Federal (22%) and state taxes are withheld from the payment, which is paid in the same form as your bi-weekly pay (eg, direct deposit or Global Cash Card). The amount of unused vacation time that is paid out can differ by bargaining unit:
- AFSCME balance of unused time
- USA/MTA balance of unused time
- PSU/MTA Unit A balance of unused time
- PSU/MTA Unit B balance of unused time
- IBPO up to 35 days
- NEPBA up to 45 days
- Faculty - balance of unused vacation time (payment confirmed by Provost's Office)
- MSP librarian balance of unused time
- Non-unit staff balance of unused time
Benefited employees who are not covered by the MSP collective bargaining agreement and who retire retire from the State Employees’ Retirement System (MSERS) or the Optional
Retirement Program immediately upon leaving university employment receive payment of 20% of unused sick time This payment is made in the same form as your bi-weekly pay (eg, direct deposit or Global Cash Card).
Personal Leave unused personal time is not paid out upon or after departure from employment.
Flexible Spending Accounts
Your participation in Health Care Spending Account and Dependent Care Assistance Program terminate as of midnight the day of your employment ends; HCSA debit cards will be inactivated.
Health Care Spending Account (HCSA)
Eligible expenses incurred on or before your last day of active employment may be submitted for reimbursement. Claims may be submitted to the FSA vendor by the Plan Year claims filing deadline.
If you have contributed more to your HCSA than you have spent account you may elect to continue to contribute to the HCSA account under COBRA by making post-tax payments directly to the GIC’s FSA vendor (who will determined COBRA eligibility) and an additional 2% administrative fee. The HCSA Continuation Coverage under COBRA General Notice and Election Form are available at www.mass.gov/gic.
Continuation of your HCSA under COBRA will allow you to continue to incur eligible expenses under that plan.
Dependent Care Assistance Program (DCAP)
You may file claims for eligible DCAP expenses up to the amount of your account balance at the time your employment ends. Expenses may be incurred through the end of the Plan Year and must be submitted by the standard Plan Year claims deadline.
- MA Group Insurance Commission (telephone: 617.727.2310)
Retirement (MA State Employees' Retirement System)
As a benefited employee of the University you have contributed to either the Massachusetts State Employees’ Retirement System (MSERS, defined benefit program, pension system) or the Optional Retirement Program (ORP, defined contribution program). Each retirement plan has rules which apply specifically to that plan. A high-level overview of your options under each plan appears below.
State Employees' Retirement System (MSERS): You have three choices re your MSERS contributions:
- Leave the funds where they are with the intent of working for the Commonwealth in the future and/or drawing your pension at a later date (note typically one must establish 10+ full-time equivalent years of creditable service in MSERS in order to draw a pension. The MA Retirement Board is the agency of record for questions in this regard: www.mass.gov/orgs/massachusetts-state-retirement-board). In this way your current service will automatically count as service toward your future vesting and/or pension,
- Roll the funds into another pre-tax retirement account (one compatible with a 401a -- eg, a pre-tax IRA with a bank), or
- Cash the funds out. 20% of your account balance will be withheld off the top for taxes & the IRS may levy an additional 10% penalty when you file taxes (for cashing out a retirement account before retirement age.)
If you choose option 2 or 3:
- The pension benefit formula is more favorable to individuals who became a member of MSERS prior to April 2, 2012 (in contrast to those whose membership was established on or after April 2, 2012). If you became a member of MSERS prior to April 2, 2012 and withdraw or roll your funds out of that system, you forfeit those more beneficial pension benefits. **
- Withdrawing your retirement funds from MSERS eliminates the corresponding Creditable Service you have established toward your pension.
- If you return to benefited service with the Commonwealth you may request to "buy back" the service cashed out toward a future pension. ** “Buying back” service established prior to April 2, 2012 will not re-establish the more favorable pension benefit formula.
- You will need to return an original, completed “Request for Return of Accumulated Deductions (Refund/Rollover Request)” form (available from the MA State Retirement Board: https://www.mass.gov/service-details/all-forms-msrb) to UMass Amherst Human Resources (181 President's Drive, 325 Whitmore Admin. Bldg., Amherst, MA 01003). This form may be completed at any time; interest accrues on the account for two years from the date MSERS membership ends. Please note: the Board requires an original, wet/ink signature on this form. Please submit the original for to UMass Human Resources.
- If you have established ten (10) or more full-time equivalent years of MSERS creditable service and withdraw or roll your funds from the system you are forfeiting your right to MA Group Insurance Commission retiree benefits.
Retirement (Optional Retirement Program)
Departure from employment means that Employer contributions will no longer be made into your Optional Retirement Program (ORP) account. You may maintain your assets in the plan, take a distribution from the plan (subject to the plan’s provisions and chosen investments), transfer assets between the ORP providers.
If you have established 10 or more years of ORP service (as determined by the MA Department of Higher Education/DHE) and you close your ORP account (through withdrawal or roll-over of funds) you will become ineligible for MA Group Insurance Commission retiree insurance benefits.
All ORP account rollover and withdrawal requests must be submitted to the Massachusetts Department of Higher Education (DHE) for processing – not to the University or the vendor with whom you invest your funds.
ORP members may obtain a statement from the DHE for Social Security purposes. When applying to draw Social Security benefits the account balance at the time of leaving Commonwealth employment will be taken into account for purposes of the federal Windfall Elimination Provision/WEP and Government Pension Offset/GPO. Information about WEP and GPO is available from the Social Security Administration (www.ssa.gov).
- ORP life and long-term disability insurance coverage typically stop at the end of the month during which the last contributions were made. You may convert your ORP disability and/or group life insurance to individually-owned policies. Information on how to convert your policy(ies) is available through the University Human Resources (Employee Service Center: www.umass.edu/humres/employee-service-center) and the Massachusetts Department of Higher Education (617-994-6960 firstname.lastname@example.org).
In certain circumstances you may be eligible to collect income through the Massachusetts Division of Unemployment Assistance (DUA). This document provides information on how to apply for unemployment income. Information is also available directly from the Massachusetts Division of Unemployment Assistance (www.mass.gov/dua).
W-2, Moving and more
Your access to the UMass payroll system (HR Direct) will end following departure from employment. Please download any historical documents you would like from the system (paychecks, W-2s) prior to leaving employment.
Your final University W-2 will be mailed to the home address on record with UMass. If your mailing address changes please notify UMass Amherst to ensure accurate and timely delivery of your W-2, 1099-HC and other tax documents.
Home and/or Auto Insurance
If you have home/and or auto insurance premium payroll-deducted please contact your insurance vendor directly to make payment arrangements and ensure coverage continues.
Please contact MetLegal directly for options.