ACT, INC. SHORT TERM DISABILITY PROCEDURES

Transcription

1 ACT, INC. SHORT TERM DISABILITY PROCEDURES January 1, 2015

2 ACT, INC. SHORT TERM DISABILITY PROCEDURES ACT, Inc. hereby amends and continues the ACT, Inc. Short Term Disability Procedures effective as of January 1, ARTICLE I INTRODUCTION The Short Term Disability Procedures have been established by ACT, Inc. (the "Employer") as a payroll practice for the benefit of its eligible employees by providing for their short-term disability needs. This document forms the ACT, Inc. Short Term Disability Procedures and will be the basis for determining short-term disability benefits. This documented payroll practice, hereinafter called the "Procedures," may be amended from time to time by ACT, Inc. to reflect changes in benefits, eligibility requirements, or any other provision, and any such change shall be binding on each covered employee. 2.1 Definitions ARTICLE II DEFINITIONS AND CONSTRUCTION The following words and phrases, when used in this policy document, shall have the following meanings: Covered Servicemember means a member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness sustained in the line of duty on active duty. Disability means that the Participant, because of Injury or Sickness is: continuously unable to perform the substantial and material duties of the Participant's regular duties of employment; under the regular care of a licensed physician; and not otherwise gainfully employed in any other occupation or activity. The loss of a professional or occupational license, including a driver's license, for any reason shall not, by itself, constitute a Disability. The Disability must begin on or after the Participant s eligibility date as set forth in Section 3.2 and before the termination of the Participant's eligibility as set forth in Section 3.3. Earnings means an Employee's weekly base pay as of the date the Disability begins. Earnings does not include overtime, bonuses, or other extra compensation.

3 Employee means any of the Employer s regular full-time employees and regular part-time employees who are in active service with the Employer. Employer means ACT, Inc., a corporation organized and existing under the laws of the State of Iowa, its predecessor companies, or its successor or successors. Injury means bodily injury caused by an accident which results, directly and independently of all other causes, in a Disability which begins after an Employee becomes a Participant. Participant means any Employee of the Employer who is eligible to participate in under these Procedures pursuant to the provisions of Article III. Procedures means the ACT, Inc. Short Term Disability Procedures as herein set forth and as may be amended from time to time. Sickness means sickness or disease causing a Disability, including pregnancy and childbirth, which begins after an Employee becomes a Participant. 3.1 Eligibility ARTICLE III ELIGIBILITY FOR PARTICIPATION An Employee of the Employer shall participate in the Plan is he or she is employed as a regular full-time employee or regular part-time employee and is regularly scheduled to work for the Employer. Any former Employee, including a former Employee whose continuous service was broken, who again becomes an Employee, shall be treated as a new Employee for purposes of this Article III. If an Employee is not actively at work on the day he/she becomes eligible to become a Participant, coverage will not become effective before the day the Employee returns to active work. "Actively at work" means the active expenditure of time and energy in the service of the Employer. 3.2 Eligibility Date Any Employee of the Employer who is eligible to participate under Section 3.1, shall become a Participant on the day that the Employee is first actively at work as an eligible Employee. 2

4 3.3 Termination of Eligibility An Employee's eligibility to participate and receive benefits under the Procedures will terminate at the close of the day in which any of the following conditions first occurs: a. The Procedures are terminated or amended in such a way that the Employee is ineligible to receive benefits under the Procedures; or b. The Employee ceases, for reasons other than a covered Disability, to be in continuous employment with the Employer as an eligible Employee. An Employee shall be considered to be in continuous employment during the following leaves of absence: (1) A leave of absence up to twelve (12) weeks (twenty-six (26) weeks in the case of an Employee needing to care for a Covered Servicemember who is recovering from a serious injury or illness sustained in the line of duty while on active duty) that is granted by the Employer as leave under the Family and Medical Leave Act of 1993; (2) Any period of qualified military leave required by the Uniformed Services Employment and Reemployment Rights Act of 1994; and (3) Any other employer-approved leave of absence up to three (3) months from the date the leave began. For this purpose, an Employee who is employed for a period of less than a full year and who ceases to be in continuous employment due to completion of the period of scheduled employment for the Employee shall not be considered to be on an employer-approved leave of absence notwithstanding the expectation of resumption of active employment at a future date. 4.1 Weekly Income Benefit ARTICLE IV BENEFITS Subject to any reduction of benefits required by Section 4.5, a Participant who incurs a Disability shall be entitled to receive, beginning on the Benefit Commencement Date (as defined in Section 4.2) a Weekly Income Benefit equal to 60% of the Employee's weekly Earnings. Each Participant s Weekly Income Benefit shall continue for a period not to extend beyond the Disability Benefit Period. Notwithstanding any provision in this policy to the contrary, Weekly Income Benefits shall not be payable after the 3

5 Participant becomes eligible for benefits under any long-term disability plan that is sponsored by the Employer. In no event shall Weekly Income Benefits accrue or be paid after the Participant s death. All Weekly Income Benefits shall be paid from the general assets of the Employer and, at the option of the Employer, will be paid in accordance with its regular payroll practices. The Weekly Income Benefit shall be subject to all required tax withholding of federal, state or local laws. At the option of the Participant, the Participant may choose to use unpaid time or accrued time off during the Disability Benefit Period to supplement his or her weekly income up to forty percent (40%) of the Participant's base pay so as to receive total compensation during the Disability Benefit Period of one hundred percent (100%) of the Participant's base pay. 4.2 Benefit Commencement Date The Benefit Commencement Date for a disabled Participant shall be the eleventh (11 th ) calendar day following the onset of the Disability. The date of the onset of a Disability shall be determined on the basis of all information made available to the Employer. Benefits payable for less than one week will be paid at the rate of one-fifth (1/5 th ) of the Weekly Income Benefit for each day of Disability. 4.3 Disability Benefit Period Weekly Income Benefits will be payable during the Disability Benefit Period for each period of Disability or Partial Disability. The Disability Benefit Period shall be the period beginning on the Benefit Commencement Date specified in Section 4.2 above and shall end on the date of the first to occur of the following: a. The six month anniversary of the Benefit Commencement Date; b. A physician declares the Participant is no longer Disabled; c. Benefits become payable under any long term disability plan maintained by the Employer; d. The termination of the Employee's employment by the Employer; e. The completion of the Employee's scheduled term of active employment with the Employer; or f. Death of the Participant. No benefits shall be paid under the Procedures during any period that the eligible Participant is confined for any reason in a jail, correctional institution or to the Participant's home pursuant to the order or sentence of a court. 4

6 4.4 Subsequent Disability In determining the duration of a Participant's Weekly Income Benefits under Section 4.3, a new Disability Benefit Period shall be considered to begin in accordance with the following: a. If an Employee becomes Disabled due to the same or a related cause, a new Disability Benefit Period will start only if the Employee has returned to active full-time employment for two (2) full consecutive weeks. b. If an Employee becomes Disabled due to an unrelated cause, a new Disability Benefit Period will start only if the Employee has returned to active full-time employment for one (1) full day. 4.5 Coordination of Benefits The Weekly Income Benefit which the Participant is entitled to receive shall be reduced by the total amount of benefits or compensation which he or she or any other person on his or her behalf receives or is entitled to receive during the period that disability benefits are paid from any other source, including, but not limited to: a. Disability benefits paid, payable, or for which there is a right under: (1) The Social Security Act, including any amounts for which the Participant's dependents may qualify because of the Participant's Disability; (2) Any workers' compensation or occupational disease act or law or any other law which provides compensation for an occupational injury or sickness; (3) Any disability or total or permanent disability provision of any group or insurance plan; or (4) Any retirement or pension plan. b. Subject to Section 4.1, any wages, salary, or other compensation received from the Employer or from any other source which is attributable to the Participant's work or service. c. Disability benefits paid, payable, or for which there is a right under any state disability law. d. Any federal, state, or municipal government disability or retirement plan. 5

7 e. The mandatory portion of any "no fault" motor vehicle plan or state compulsory benefit act or law. f. Any benefits or payments received under an unemployment compensation law. Coordination of all such other sources of compensation or benefit payments will be based on the benefits to be paid under such program or plan on the date each Weekly Income Benefit is due. If the Employee accepts a lump sum settlement in lieu of all or part of the periodic benefits payable from any of the above sources, such periodic payments will, for purposes of determining the Weekly Income Benefit, be considered to continue for the number of weeks determined by dividing the lump sum received by the weekly equivalent of such periodic payments, and such equivalent payment will reduce the Weekly Income Benefit for such number of weeks. At no time shall the Procedures result in the payment of benefits and compensation to a Participant during a period of Disability which are greater, in the aggregate, than the Participant's pre-disability Earnings. 4.6 Exclusions A Benefit will not be paid for any Disability: a. Covered by workers compensation or similar legislation, or due to any injury or sickness sustained from or arising out of the course of any employment; b. Resulting from war, declared or undeclared, or any act of war, insurrection, rebellion, or active participation in a riot, or resulting from service in the armed forces; c. Resulting from the Participant s participation in an illegal occupation, commission of or participation in an assault or any felony; d. Resulting from elective cosmetic surgery, provided, however, that cosmetic surgery necessary to correct a deformity due directly to a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease shall not be excluded under this Section 4.6; or e. Resulting from the Participant s confinement in a jail or prison. 4.7 Evidence of Disability As a condition to receiving short term disability benefits under the Procedures, the Participant must submit such medical evidence as may be reasonably required by the Employer to establish the existence of the Disability, the date of 6

8 the onset of such Disability, and the continuation of such Disability. The Participant shall submit to all medical examinations as may be ordered from time to time by the Employer pursuant to Section 7.3. In the event a Participant should fail to provide adequate evidence of his or her Disability to the Employer or fail to submit to any medical examination required by the Employer, the Weekly Income Benefits provided such Participant shall be terminated. 5.1 Employer Contributions ARTICLE V CONTRIBUTIONS All payments of Weekly Income Benefits shall be paid from the general assets of the Employer. ARTICLE VI ADMINISTRATION 6.1 Administration and Amendment or Termination of Procedures The Employer, acting through its appropriate officers and authorized employees, shall be the sole administrator of the Procedures. The Employer may amend or terminate the Procedures in whole or in part at any time. 6.2 Administrative Powers and Duties The Employer shall have complete and unfettered discretionary authority and power as may be necessary to administer the Procedures, including, but not by way of limitation, the following: a. To decide all questions of eligibility and determine the amount, manner and time of payment of any benefits hereunder; b. To prescribe procedures to be followed by Participants or former Participants filing applications for benefits; c. To prepare and distribute information explaining the Procedures; and d. To adopt such rules of general applicability as it deems necessary, desirable, or appropriate in the administration of the Procedures. 6.4 Application and Forms for Benefits The Employer will require a Participant to complete and file with it an application for a Weekly Income Benefit, and to furnish all pertinent information as may be 7

9 required by the Procedures or appropriately requested for the administration of benefits. If a claims administrator is appointed, all claims shall be submitted to such claims administrator pursuant to the forms provided and procedures established by such claims administrator for processing Participant claims. The Employer may rely upon all such information so furnished to it, including the Participant's current mailing address. 6.5 Facility of Payment Whenever, in the Employer's opinion, a Participant entitled to receive any payment of a benefit hereunder is under a legal disability or is incapacitated in any way so as to be unable to manage his or her financial affairs, it may direct payments for such person to his or her legal representative, or to a relative or friend of such person for his or her benefit, or it may direct payment for the benefit of such person in such manner as it deems advisable. 6.7 Right of Recovery The Employer shall have the right to recover any benefits paid under the Procedures resulting from a Disability for which a third party is liable and for which recovery is made from the third party, whether by judgment, settlement or otherwise, as determined after reasonable and necessary expenditures incurred by the Participant to obtain such recovery are deducted. The Employer shall also be entitled to recover any overpayment of benefits under the Procedures. Erroneous statements will not change the rights or obligations of the Employer under the Procedures and will not operate to grant additional benefits or coverage. 7.1 No Assignment or Alienation ARTICLE VII MISCELLANEOUS PROVISIONS Benefits, payments, or proceeds payable with respect to the Procedures shall not be assigned or alienated. 8

10 7.2 No Continued Employment The Procedures are not to be deemed to constitute a contract between the Employer and any Participant or to be a consideration or inducement for the employment of any Participant. Nothing contained in this policy shall be deemed to give any Participant the right to be retained in the service of the Employer or to interfere with the right of the Employer to discharge any Participant at any time regardless of the effect such discharge shall have upon the Employee as a Participant. 7.3 Physical Examination The Employer, at its own expense and through its own designated physician, shall have the right and opportunity to examine the individual whose injury or sickness is the basis of a claim when and as often as it may reasonably require during the pendency of a claim hereunder. 7.4 Document Changes or Modifications The Employer has the sole authority to amend or modify the Procedures. Any change so made by the Employer shall be in writing and shall thereupon be binding on each Participant and on any other individual or individuals referred to in this policy. 7.5 Assignment of Rights Any Weekly Income Benefit paid under the Procedures and accepted by an Employee automatically assigns to the Employer, to the extent of any such payment, all of the Employee's rights against any person or entity who might be legally liable to the Employee or his or her dependents for such amount. DOCS/