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402.8 Salary Reduction or Compensation


Series 400 - Staff Personnel
Salary Reduction or Compensation Code No.  402.8
Pursuant to Section 125 of the Internal Revenue Code, the Forest City Community School District, as the employer, offers to all employees the opportunity to have a portion of gross salary redirected to pay their required contributions/premiums for benefits sponsored by the Employers’ Flexible Benefit Plan.
Description of Benefits
a. Benefits offered under this plan are specifically health and dental insurance.
b. By employee class, each employee will have the following choices of taxable and non-taxable benefits:
(1) Support Staff
Dependent health insurance
Dependent dental insurance
(2) Professional Staff
Dependent health insurance
Dependent dental insurance
Rules of Participation
a. Eligibility:  The plan is available to all professional and support employees of the District.
b. Election Required
(1) All employees will be given the option to elect to receive the taxable or non-taxable benefit
(2) Any employee failing to make an election within the time period specified herein will, by default, have elected to receive the benefit as taxable compensation.  Under this circumstance, the cost of dependent health and dental insurance coverage selected by the employee will be deducted as a payroll deduction item on each of the employee’s regular paychecks and be subject to all applicable payroll taxes.
a. Election Period:  Employees shall make the election not earlier than forty-five days nor later than fifteen days prior to the first payment under the employee’s new employment contract.
b. Election Irrevocable:  The election, with the exception of an event (e.g. marriage, divorce, death of spouse or child, birth or adoption of child, and termination of employment of spouse), which changes the employee’s present family status, shall be irrevocable for the contract year.
c. Period Covered by Election:  The election made by an employee shall cover a twelve-month period beginning with the first pay period of the new fiscal year.  An election made by an employee beginning employment after the start of the regular contract year shall remain in effect for the balance of months remaining in that contract year.
d. Renewal of Contract:  Unless otherwise specified, elections of an employee shall automatically he continued on a year-to-year basis.  Any changes in an election, except as specified in paragraph 4 (b), may only be made during the election period defined in paragraph 4 (a).
Manner in Which School Contributions are Made.  The District will make employer contributions pursuant to a salary reduction agreement under which the employee will elect to reduce his/her compensation and to have such amounts contributed, as employer contributions, by the District on the employee’s behalf.
Maximum Amount of District Contribution:  District contribution shall be limited to the amount specified in the salary reduction agreement pursuant to paragraph 5.
Plan Year:  The plan year shall parallel the fiscal year of each employee group.  The plan year shall be twelve months beginning with the first pay period of the employee’s contract year.
Adoption:   4/14/86
Review       7/17/89      03-13-08 9-9-13  9-10-18
Revision     4/11/94      02-14-02
Cross References:
Legal References: 26 U.S. §125; Iowa Code §279.12