HR Glossary for HR Professionals
Glossary of the most common HR terms and acronyms to assist professionals navigating the ever-growing and ever-changing world of HR terminology.
What is a Waiting Period?
In the context of human resources, a waiting period is the amount of time an eligible employee must work for an employer before their job-based benefits coverage begins.
Employers typically work with insurance companies and brokers to set waiting periods for their staff.
Why Do Employers Have Waiting Periods?
Employers may implement preset waiting periods for a variety of reasons, including to offset financial costs and properly prepare for government compliance. With that said, a primary purpose is to determine whether or not an employee fits into the company.
Due to high turnover within the first few months of employment, an organization may want to mitigate the cost of subsidized care for a worker who may only be on the team for a few weeks.
Oftentimes, if an employee is moving from one job to another, they may already be covered under COBRA continuation care or a conquerable temporary healthcare plan.
Are There Restrictions on Waiting Periods?
Yes. According to the Affordable Care Act (ACA), there is a 90-day limitation on waiting periods for employees who qualify for healthcare coverage.
With that in mind, some employers elect to offer benefits coverage right away, while others choose 30 or 60 days after the date of hire.
Related Terms: Employee Benefits, Affordable Care Act (ACA)