Healthcare Costs

Question: The cost of healthcare is too costly for our church to provide benefits to a full-time employee. Is this illegal?

Answer: Employers are not required by law to provide health benefits to their employees. However, there could be legality problems if you provide healthcare for some full-time employees but not all of them. This would be a violation of ERISA.

However, your State Department of Labor and your State Deparment of Insurance should be consulted if your have large groups. For example, in NC all full-time employees must be treated equally. However, NC insurance laws do provide that if your group exceeds 50 full-time employees then you can create an executive class of employee. That executive class can be provided better benefits than the remaining employees. In NC if a company (or not-for-profit) had 51 full-time employees, it could create an executive class. In a church this could be the executive team or maybe the entire pastoral staff. If in this example there are 10 pastors and 41 other full-time employees and all full-time employees are provided employee only health coverage, the executive class could actually receive better coverage. They could receive employee/spouce coverage or even family coverage. The first requirement is size. Please note that additional consideration should be given to employee morale and stewardship.