Or. Admin. Code § 471-070-2450

Current through Register Vol. 63, No. 10, October 1, 2024

Section 471-070-2450 - Equivalent Plans: Termination by the Department

(1) The department may terminate an employer's equivalent plan due to reasons that include, but are not limited to:

(a) Misuse of employee contributions withheld or retained by the employer;

(b) Failure to adhere to the department approved equivalent plan or to report substantive equivalent plan changes to the department;

(c) Failure to adhere to applicable Paid Family and Medical Leave Insurance (PFMLI) program requirements, including but not limited to OAR 471-070-2220 and equivalent plan reporting requirements;

(d) Failure to file for reapproval as required in OAR 471-070-2210;

(e) Employer insolvency;

(f) Termination of the insurance policy by the plan administrator;

(g) Closure of a business; or

(h) Failure to respond timely to the department's reasonable inquiries for information about the equivalent plan.

(2) If the plan administrator plans to terminate an employer's insurance policy, the administrator must provide notice to the department at least 30 calendar days prior to the termination date. The termination date must be effective on the last day of a calendar quarter. The administrator's notice to the department should include:

(a) The original effective date of the fully insured equivalent plan policy; and

(b) The effective date of the termination requested by the administrator.

(3) If the department seeks to terminate an equivalent plan, the department will send the employer and administrator, if applicable, a notice of termination to the employer's last known address, or electronically when permitted, if the employer has opted for electronic notification, as shown in the department's records. The notice must provide:

(a) The reason(s) for the termination;

(b) Instructions on how to resolve the reason(s) for termination; and

(c) The effective date of termination, which must be the last day of a calendar quarter, absent further specified action by or on behalf of the employer.

(4) An employer may appeal the notice of termination in accordance with ORS 657B.410 and applicable administrative rules within 20 calendar days of the notice of termination.

(5) The employer or administrator must notify all employees of any equivalent plan termination within 10 business days after the date the termination becomes effective.

(6) All applicable equivalent plan requirements, including but not limited to those outlined within OAR 471-070-2220 and equivalent plan reporting requirements as outlined in OAR 471-070-2230, remain in effect until the effective date of any termination.

(7) The employer or administrator must pay or continue to pay benefits under the terms of the equivalent plan to eligible employees who were approved for or receiving benefits under the equivalent plan on the effective date of termination until the total amount of the benefit claim is paid, the duration of leave ends, or the benefit year ends, whichever occurs first. If the employer or administrator does not pay the benefits, the employee may file an appeal with the employer as described in OAR 471-070-2220(13) and then a dispute resolution request with the department as described in OAR 471-070-2400.

(8) Within 30 calendar days after the effective date of the termination of an equivalent plan, the employer must send to the department all reporting requirement information on benefit claims paid, amounts of contributions collected or owing, and administrative expenses incurred as specified in OAR 471-070-2230 from the date of the last report provided to the department under the equivalent plan reporting requirements to the date of termination.

Example: Donald Mouse Partnership's equivalent plan became effective April 1, 2023. On January 31, 2024, Donald Mouse Partnership provided the aggregate equivalent plan information from April 1, 2023, to December 31, 2023. The equivalent plan is terminated effective March 1, 2024. By April 1, 2024, Donald Mouse Partnership must send the aggregate equivalent plan information from January 1, 2024, to February 29, 2024.

(9) Once the department receives the report specified in section (8) of this rule, the department will provide an invoice of the contribution amounts due, if any. The contribution amount due is calculated based on any contributions withheld from employee's wages that remain in the possession of the employer upon the effective date of the equivalent plan termination, minus an amount equal to the amount of any benefits due to be paid as required under section (7) of this rule and any anticipated administrative expenses. Once all required benefits are paid under section (7) of this rule, the employer must immediately send to the department the final report on any additional benefit claims paid or administrative expenses incurred after the date of the last report provided under section (8) of this rule. Once the department receives the report, the department will provide an invoice of any additional contribution amounts due. Any remaining contribution amounts due are deposited into the PFMLI Trust Fund.

(a) Any contributions become due and payable to the department on the effective date of termination unless the employer timely requests an appeal in accordance with section (4) of this rule.

(b) Interest on the contribution amount due from the employer shall accrue from the date of invoice(s) until paid to the department, in accordance with ORS 657B.320(3).

(10) Upon the effective date of an equivalent plan termination, the employer must begin paying employee and employer contributions, if required, in accordance with ORS 657B.150 and other applicable statutes and rules.

(11) After the department terminates an equivalent plan, the employer may not reapply for an equivalent plan approval within three years following the date of termination.

Or. Admin. Code § 471-070-2450

ED 8-2022, adopt filed 04/21/2022, effective 4/21/2022; ED 3-2023, amend filed 07/31/2023, effective 8/1/2023

Statutory/Other Authority: ORS 657B.340

Statutes/Other Implemented: ORS 657B.210, 657B.220 & 657B.240