What is voluntary short-term disability (STD)?
Voluntary STD insurance can help you replace part of your income in the event of illness or disability. If you are unable to go back to work for either reason, you can file a claim directly with our voluntary STD provider and they will pay you the replacement income directly. Voluntary STD insurance can go into effect after you’ve been away from work for 7 days and can help you replace up to 6 months of lost income.
How does voluntary STD differ from noncontributory STD?
Voluntary STD insurance is optional and paid for entirely by the employee. Premiums are deducted from the employee’s paychecks after-tax. As a result, claims are tax-free. Noncontributory STD is a company-paid benefit that is automatically extended to all employees who are eligible for benefits. Premiums are paid for directly by the company and employees do not pay taxes on these premiums. As a result, if you file a claim, the payout from the claim will be considered taxable income.
Who is your voluntary STD provider?
Our voluntary STD policy is provided by MetLife. Founded in 1868, MetLife is one of the largest insurance companies in the world and serves approximately 100 million customers.
How does enrollment for voluntary STD work?
Voluntary STD offers two enrollment opportunities. At the time of hire or at the time you become eligible for benefits, you will have 30 days to enroll for voluntary STD online in Justworks. If you’d like to sign up after that 30 day window has closed, you can contact our support team at 1-888-534-1711 or email@example.com, and request to do a paper enrollment.
Enrolling outside of the 30 day online window requires that a statement of health be completed and your application is subject to rejection by our provider, MetLife. If you enroll within the 30 day window, you will be automatically approved for coverage.
Is voluntary STD coverage restricted in some states?
There are no state restrictions.
Who can sign up for voluntary STD?
- All benefits-eligible employees at companies offering voluntary STD can sign up. Benefits-eligible employees are defined as Full-Time and Part-Time employees working over 30 hours per week.
- Paid owners are eligible to enroll.
Unpaid owners are NOT eligible (unlike non-contributory STD), because voluntary STD premiums are collected from member’s vouchers, and unpaid owners do not have a salary (and therefore no vouchers) to collect the premiums from.
If you are eligible for this benefit, you will receive an enrollment opportunity in Justworks at the time of hire or at the time you become eligible for this benefit.
What will my company be charged when offering voluntary STD?
When offering voluntary STD through Justworks, the employee (member) pays the premiums. Premiums are charged directly to the employee’s voucher.
How is voluntary STD billed?
Justworks bills for voluntary STD semimonthly. Your monthly cost will be split across the first and second paycheck of the month. If you’re on a semi-monthly payroll schedule, you will have a deduction for every paycheck. If you are on a biweekly or weekly payroll schedule, you will have a deduction for 24 paychecks out of the year.
Please note, if there are 3 biweekly paydays in a given month, deductions will occur on the 1st paycheck of the month and on the 1st paycheck on/after the 15th of the month.
How much does voluntary STD cost?
The cost to you is based on your current income. If your income increases or decreases, so will your monthly cost. Your monthly cost is determined by taking your weekly benefit and multiplying it by the policy rate per $10 of covered benefit.
How is the weekly benefit for voluntary STD calculated?
The weekly benefit is based on your current income. If your income increases or decreases, so will your weekly benefit up to a maximum of $1,000. Effective November 1, 2019, your weekly benefit is determined by taking your weekly salary (or your yearly salary divided by 52) and multiplying it by 60%, up to a maximum of $1,000.00.
Can I cancel my voluntary STD policy at any time?
Yes, you can cancel your policy at the end of any month of coverage. To cancel your policy, please contact our support team at 1-888-534-1711 or firstname.lastname@example.org.
When an employee is separated from employment when will the voluntary STD benefit termination occur?
The voluntary STD policy will terminate at the end of the employee's separation month.
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.