Short-Term Disability Pay Policy For Salaried Associates

Transcription

1 Short-Term Disability Pay Policy For Salaried Associates January 1, 2010

2 Table of Contents Introduction 3 Important Contact Information 4 Eligibility and Enrollment 5 Associate Eligibility 5 Associate Status Change 5 Rehire/Reinstatement 5 Family Medical Leave Act of Policy Benefits 7 Definition of Disability 7 Applying for Short-Term Disability Pay 7 When Short-Term Disability Pay Begins 8 Exclusions 8 Eligible Earnings 9 Disability Service 9 Payment Schedule 10 Payment Calculation Example 10 When Payments are Made 11 How Other Disability Payments Affect Short-Term Disability Pay 11 Overpayment of Short-Term Disability Payments 11 Substance Abuse 12 When Short-Term Disability Payments End 12 Continuation of Other Group Benefits while on Medical Leave 13 Long-Term Disability 13 Returning to Work 14 Reporting Your Return to Work 14 Partial Short-Term Disability or Returning to Work with Restrictions 14 Disability Recurrence 14 When Short-Term Disability Coverage Ends 15-2-

3 Introduction CarMax offers full-time, Salaried Associates a Short-Term Disability Pay Policy ( the STD Policy ) that is designed to provide income protection benefits for participants who meet the qualifications of the program. When an illness or injury prevents a participant from working, the STD Policy may provide pay based on a percentage of that Associate s eligible earnings. Short-Term Disability pay under the STD Policy is fully funded by the Company. This booklet was designed to be an easy-to-read information resource about the CarMax STD Policy. It describes the STD Policy in effect as of January 1, 2010 except as otherwise noted. Associates should also refer to the Company s FMLA and Medical Leave Policies for detailed information regarding their rights and responsibilities while on leave from the Company (as defined in each Leave Policy). Such Leave Policies are coordinated with the STD Policy and payments under the STD Policy run concurrently with approved leave time. The STD Policy is a very important component of your total benefits program. You should read this information carefully, share it with your family, and keep it with your other important records. The Company reserves the right to revise or terminate the STD Policy, in whole or in part, at any time. The Company also may revise the STD Policy as necessary to comply with federal and state laws, statutes and regulations. The Company will notify you if the STD Policy is revised or terminated. -3-

4 Important Contact Information CarMax Leaves Administrator Call with any questions regarding the STD Policy, or to obtain any necessary forms. (888) , option 3 10:00 a.m. to 8:00 p.m. ET Monday through Friday CarMax Leaves Administrator Send (mail or fax) claims, written appeals, and medical certifications. Fax or mail information and forms to: CarMax Leaves Administrator P.O. Box Des Moines, IA Fax: (515)

5 Eligibility and Enrollment Associate Eligibility All regular, salaried, full-time Associates, who are regularly scheduled to work at least 30 hours per week, are eligible for Short-Term Disability pay under the STD Policy as of their date of hire. You are automatically covered by the STD Policy when you meet the eligibility requirements; no enrollment forms are required. Temporary and/or part-time Associates (normally scheduled to work less than 30 hours per week) are not eligible. Associate Status Change From Full-time to Part-time or Temporary: If you experience a status change from full-time to part-time or temporary, you are no longer eligible for STD pay. Coverage under the STD Policy will end automatically on the effective date of the status change. From Part-time or Temporary to Full-time: If you experience a status change from part-time or temporary to full-time salaried, you become eligible for STD coverage on the effective date of the status change. From Hourly or Commissioned to Salaried: If you transfer from a position in which you are paid an hourly rate or commission to a salaried position, you will be eligible for coverage under this policy on the effective date of the status change. From Salaried to Hourly or Commissioned: If you transfer from a salaried position to an hourly/commissioned paid position, your eligibility for STD pay will be based on the eligibility requirements of the Short-term Disability Pay Policy for Hourly and Commissioned Associates. Rehire/Reinstatement In accordance with the CarMax Associate Classifications, Status & Status Changes, Rehire/Reinstatement Policy (available on the CarMax Way), if you terminate employment and are later rehired or reinstated as a salaried full-time associate, you will be eligible for coverage under this policy on the date of your rehire or reinstatement. -5-

6 Family Medical Leave Act of 1993 The Family Medical Leave Act ( FMLA ) is a federal law that provides up to 12 weeks of unpaid time-off during any rolling 12-month period for Associates who meet certain requirements. The requirements include completing one continuous year of service with the Company and working at least 1,250 hours with the Company during the 12 months before beginning FMLA Leave. Eligible Associates can take FMLA Leave and come back to the same position held before the leave or to an equivalent position with equivalent pay and benefits, for the following reasons: - Due to their own serious health condition, or - To care for a seriously ill spouse, child or parent, or - For the birth of a child or to care for a newborn, or - For the placement of a child with the Associate for adoption or foster care. An Associate taking FMLA Leave must provide certification from a health care provider and timely notice of the need for leave. For instance, when the need for the leave is foreseeable, the Associate must inform the Leaves Administrator of the need for FMLA Leave at least 30 days prior to the start of the leave. In situations where the need for leave cannot be anticipated 30 days in advance, the Associate must inform the Leaves Administrator of the need for FMLA Leave as soon as possible after the Associate learns of the need for leave, and no later than within two business days of returning to work. In addition to this STD Policy, the FMLA Leave Policy, the Associate handbook, the Family Medical Leave Act Notice (available on the CarMax Way), and the FMLA poster at your work location provide information about your FMLA rights. Some states have leave laws that differ from the FMLA. When state law differs from the FMLA, the Company will abide by both laws and provide the benefits, pay, leave, and protections most favorable to you under the applicable laws. If you go on an FMLA Leave and are entitled to Short-Term Disability pay (based on the provisions of the STD Policy) for some portion of the leave period, such pay will run concurrent with your FMLA Leave time. Please refer to the Family Medical Leave Act Policy in the CarMax Way if you have any questions or concerns regarding FMLA Leave, or need information on how to apply for FMLA Leave. You may also obtain more information from your Human Resources Manager or the Leaves Administrator. -6-

7 Policy Benefits Definition of Disability Disability under the STD Policy is defined as an illness, injury, mental condition, or pregnancy-related condition, as certified by a Medical Doctor, which prevents you from working for more than five consecutive, scheduled workdays. This includes medical absences due to job-related injuries or illnesses. A Medical Doctor is a duly licensed Doctor of Medicine or Osteopathy under applicable state laws. Applying for Short-Term Disability Pay Any time you will be out of work because of a Disability, you must contact your manager to notify him/her of your absence. If you will be out of work for more than five consecutive workdays, you must also notify the Leaves Administrator of your need for Medical Leave and provide medical certification of your illness. Please refer to the Medical Leave Policy on the CarMax Way for detailed information on how to report your Medical Leave and your rights and responsibilities while on Medical Leave. Within 15 calendar days from the date of your request for Medical Leave, you must mail or fax a doctor s note or medical certification reflecting the need for Medical Leave to the Leaves Administrator. The medical certification must include the following information: your medical diagnosis; the date of the first day you were unable to work due to this condition; the date of your projected full duty release or, if unknown, the date of your next doctor s appointment; a signature from your treating physician. Your eligibility for STD pay under the STD Policy is evaluated based on your request for Medical Leave, the determination of whether you meet the definition of Disability (described above), and the required documentation being submitted to support your request. No separate application process for STD pay is required. In some instances, the Company may require that you be examined by a Medical Doctor, appointed by the Company, to make a final determination of your Disability status. The Company will pay the costs for this examination. Based on the results, the Company may limit your STD pay and/or the length of time you are considered absent for STD. Generally, this limitation applies only if the length of time requested by your Medical Doctor is longer than normally required for similar disabilities, in the opinion of the Medical Doctor appointed by the Company. -7-

8 Policy Benefits After you have submitted the required information, your forms have been processed, and your Disability has been approved, you will receive a notice of the approval at your home address. In order to receive any pay under the STD Policy, you may be required to sign and return an authorization for the release of medical information from our health plan to the Leaves Administrator, or any company hired by the Leaves Administrator or the Company, to perform clinical management services assisting in the management of your case. The information that can be disclosed includes, but is not limited to, any information: relating to a medical condition, disease, or treatment thereof; necessary to determine your eligibility for pay under the STD Policy; necessary to monitor your Medical Leave or eligibility for STD pay, including case management and quality control efforts. It is very important to maintain contact with your manager and the Leaves Administrator during your Medical Leave, even if you are not receiving STD pay. Medical certifications must be kept up to date in order to inform the Leaves Administrator of the duration of your absence, your diagnosis, and when your doctor expects your return to work. Failure to report absences to your manager and the Leaves Administrator may result in termination of your employment with the Company. When Short-Term Disability Pay Begins Your date of disability is your first scheduled workday of disability absence as certified by a Medical Doctor. STD pay begins on your date of disability. STD pay will not be paid until the required documentation has been submitted and the disability has been approved. Exclusions STD pay will not be paid for absences due to medical conditions that are: intentionally self-inflicted; related to elective cosmetic surgery or treatment; related to current use of illegal drugs (within the meaning of the Americans with Disability Act); a result of work for pay or profit other than as an Associate of CarMax; due to voluntary participation in unlawful acts; due to war, declared or undeclared, any act of war, or active participation in a riot -8-

9 Policy Benefits Several factors are taken into account when determining the amount of your STD pay. The maximum pay you may be eligible to receive will depend on your years of disability Service and your Eligible Earnings. Eligible Earnings Eligible Earnings mean your average weekly earnings for the 12 consecutive months immediately preceding your date of disability. If you worked less than 12 consecutive calendar months prior to your date of disability and are eligible for pay, Eligible Earnings are the weekly equivalent of earnings for the full calendar months worked. Earnings include base pay, commissions, monthly bonuses, and STD pay before pre-tax deductions are withheld, such as 401(k) Plan contributions or your health plan premiums. Earnings exclude overtime and special allowances such as year-end bonuses, stockrelated income, cost of group life insurance included in taxable income, moving bonuses, tuition reimbursement, meal allowance, and similar items. Disability Service Your Disability Service is your completed years of service on your initial date of disability. If you complete another year of service during your period of Disability, benefits will not change to reflect the additional year. If you have had interrupted service, your Disability Service will be calculated as follows: If you were rehired, your Disability Service will not include prior employment periods with the Company. In this case, your Disability Service would be counted from your most recent date of hire with the Company. If you were reinstated, your Disability Service will include prior service with the Company (to the extent such service was reinstated). Note: Please refer to the CarMax Associate Classifications, Status & Status Changes, Rehire/Reinstatement Policy (found on the CarMax Way) for more information regarding your classification upon reemployment. If you transferred from an hourly, commissioned, part-time or temporary status, you will receive Disability Service credit for related periods of service. -9-

10 Policy Benefits Payment Schedule The Payment Schedule takes into account your Disability Service with the Company in order to determine the number of weeks and the percent of Eligible Earnings that will be paid to you for the duration of your Medical Leave. Years of Disability Service # of Weeks at 100% of Pay # of Weeks at 75% of Pay # of Weeks at 50% of Pay Total Eligible Weeks Less than 1 Year Pay Calculation Example The following example shows how pay is calculated for a salaried Associate with one year of Disability Service and Eligible Earnings of $400 per week. Please note that this is only an example of how STD pay is calculated. Actual pay received under the program will generally differ for each Associate. 8 Weeks at 100% of Eligible Earnings 1 Week at 75% of Eligible Earnings 4 Weeks at 50% of Eligible Earnings Plus Plus 8 Weeks: $400/week x 100% = $400 per week x 8 weeks = $ 3,200 1 Week: $400/week x 75% = $300 per week x 1 week = $ Weeks: $400/week x 50% = $200 per week x 4 weeks = $ Weeks Total STD Pay: $4,

11 Policy Benefits When Payments are Made STD payments are made on your normal paycheck cycle based on your position prior to the leave. Your check (or direct deposit advice) will be sent to the location where you are employed. How Other Disability Payments Affect Short-Term Disability Pay Your STD pay may be affected by any payments that you are entitled to receive from Workers Compensation, Social Security, State Disability, or any other employmentrelated benefits. Please note that the method for calculating STD benefits under this policy may differ from the methods used by other parties. Please refer to the Eligible Earnings section of this document for information on how CarMax calculates your STD benefits. Workers Compensation payments will be paid to you directly from the Workers Compensation carrier. These payments will be separate from your STD pay, which is paid by the Company. If your weekly Workers Compensation benefits are greater than or equal to your weekly Company STD pay, then you will not receive any STD pay from the Company. If your weekly Workers Compensation benefits are less than your weekly Company STD pay, then the Company will pay you the difference. Associates who work for the Company may qualify to receive State Disability and Company STD pay. You are responsible for completing and filing any State Disability Benefit application forms. Your STD pay may be reduced by State Disability Benefits. If you are entitled to State Disability Benefits, your STD pay plus State Disability Benefits will not exceed 100% of your Earnings as of your initial date of disability. Overpayment of Short-Term Disability Payments If you are receiving regular STD pay from the Company and you later receive payments from an external source applicable to the same period of time, any overpayment of STD pay must be repaid to the Company. The same is true for any payroll overpayments made in error. The Company reserves the right to recover any overpayment of STD pay from future compensation. -11-

12 Policy Benefits Substance Abuse No STD pay is available for absences due to the current use of illegal drugs (within the meaning of the Americans with Disabilities Act). Before you return to work following a Disability resulting from substance abuse, you must provide certification from a Medical Doctor that you have successfully completed a course of rehabilitative treatment. When Short-Term Disability Payments End When your Disability ends, you must immediately notify your supervisor or manager with a statement from your Medical Doctor. Your STD payments will be made until the earliest of the following: you return to your regularly scheduled hours in effect prior to your Disability; or you exhaust your eligible benefits; or you no longer have a medical condition, as certified by a Medical Doctor, that prevents you from working; or the date you are able to work under the terms of the Company s policies for returning to work and you choose not to. -12-

13 Continuation of Other Group Benefits while on Medical Leave When you are on Medical Leave, you may qualify for continuation of coverage for your other Company-sponsored benefit plans. The Leaves Administrator will mail information to you about continuing your coverage and your responsibilities for paying premiums or contributions while you are on leave. Refer to each Plan s Summary Plan Description and/or the Medical Leave Policy for specific information about continued coverage during a leave of absence. If your absence due to a medical condition extends beyond 26 weeks, your participation in the Medical, Dental, AD&D and Life Plans will terminate at the end of the sixth month. At that time, you may continue your Medical and Dental coverage by electing to participate in COBRA benefits. If your required contributions are not up to date while on leave, you are responsible for making those payments prior to any COBRA coverage contributions. Detailed information about costs and how to continue coverage will be mailed to your home at the appropriate time. You may apply for a premium waiver for your Life Insurance under certain circumstances. Refer to the Life Insurance Summary Plan Description for details about premium waivers and continued coverage during a leave of absence. Also, please refer to the Medical Leave Policy for more information. If you have not returned to work after 26 weeks, based on Company policy, your employment with the Company may be terminated, unless otherwise prohibited by federal or state law. Long-Term Disability If your absence due to a medical condition is expected to continue beyond 26 weeks, and you are enrolled in the Company Long-Term Disability (LTD) Plan, you may be eligible for LTD payments from that Plan. Refer to the Long-Term Disability Summary Plan Description for details. -13-

14 Returning to Work Reporting Your Return to Work When your Medical Doctor releases you to return to work, it is important for you to report your return to work and provide required documentation to your manager. You cannot return to work until your manager receives a statement from your Medical Doctor indicating that you are able to return to work. Partial Short-Term Disability or Returning to Work with Restrictions If you return to work with restrictions from your Medical Doctor that reduce your regularly scheduled work hours, you may qualify for partial STD pay. You must provide your manager with a written statement from your Medical Doctor outlining any physical or mental restrictions that prevent you from performing the requirements of your former position. The Company will determine whether or not your restrictions can be accommodated and if you can be returned to your former position. You may continue to receive STD pay in addition to your earnings. Benefits will be payable for the difference between your average hours worked (excluding overtime) in the four week period prior to your date of disability (not to exceed 40 hours) and your hours upon your return to work based upon the Payment Schedule provided in this document. If your restrictions cannot be accommodated in your former position, you may apply for any open position for which you are qualified, at the pay rate applicable to that position. Disability Recurrence If you return from Disability to your regularly scheduled hours, and are absent within two calendar weeks for the same condition that caused your original Disability, your second absence will be treated as a non-interrupted continuation of your original Disability. A separate Disability occurs if: you returned to work from your original Disability to your pre-disability regularly scheduled hours and worked for more than two calendar weeks prior to the second absence, or the cause of the second absence is unrelated to your first Disability, and you completed at least one regularly scheduled workday between absences. -14-

15 When Short-Term Disability Coverage Ends Coverage under the STD Policy will end on the earliest of the following: the date you cease to be an eligible participant in the STD Policy; the date your employment with the Company ends; the date of your last day worked prior to taking a leave of absence other than a Medical Leave; or the date the STD Policy is terminated. The Company reserves the right to revise or terminate the STD Policy, in whole or in part, at any time. The Company also may revise the STD Policy as necessary to comply with federal and state laws, statutes and regulations. The Company will notify you if the STD Policy is revised or terminated. -15-