Open enrollment benefits: Guide for construction companies

Open enrollment is a recurring administrative challenge for contractors as employees review their current benefits and make elections. Construction HR teams often oversee crews across multiple jobsites and even jurisdictions, which impacts plan availability, coverage options, and payroll requirements year-round.

A good benefits package is a powerful incentive to attract skilled workers. But effectively managing and administering these packages can be just as impactful to the employee experience as the benefits themselves. As the open enrollment period draws closer, employers need to review past enrollment stats, collaborate with carriers, and ensure compliance with state and federal law.

In this guide, construction employers will learn everything they need to know about open enrollment benefits, how open enrollment works, and how they can effectively manage their obligations for a large, distributed workforce.

What is open enrollment?

Open enrollment is an annual period when employees can sign up, alter, or cancel their employer-sponsored benefits. While there’s a limited window for most workers, there are certain cases where the window changes or extends, such as for a qualifying life event or onboarding new hires.

While states have their own rules and regulations for private enrollment, companies are responsible for managing timelines and eligibility requirements for their employees. They also need to consider and follow Affordable Care Act (ACA) guidelines throughout the process.

When is open enrollment for construction companies?

A few different factors affect when open enrollment happens. Tracking this schedule requires consistent planning from construction HR teams. Ideally, preparation starts early, giving companies the time they need to build coverage options, communicate with brokers, and notify employees.

Typical enrollment windows

Contractors can set their own windows for open enrollment. But many opt to align with standard corporate timelines. This generally translates to an enrollment period between two and four weeks during the late fall and early winter season, typically around November and December.

This window allows employees to select their coverage options before most plans take effect, which is usually on January 1st.

Employer-set deadlines

While open enrollment is common late in the year, employers are allowed to set their own enrollment window duration and deadlines. Some contractors opt to align their open enrollment period with the fiscal year or carrier renewal dates.

Qualifying life events

Contractors that offer group health plans are required by law to offer a special enrollment period (SEP) for employees experiencing qualifying life events, which may fall outside of traditional or company-set deadlines. 

Qualifying life events are narrower for an employer plan than the Marketplace list most people know:

• Gaining a dependent through marriage, birth, adoption, or placement for adoption
• Losing other coverage through divorce or legal separation, a covered employee’s death, job loss, or a drop in hours
• Aging off a parent’s plan at 26
• Losing Medicaid or CHIP eligibility

What benefits can construction companies offer during open enrollment?

Good employee benefits packages typically include basic necessary coverage as well as some supplemental perks. Offering comprehensive benefits is one of the strongest ways to improve employee retention. Below are a few examples. 

Medical, dental, and vision insurance

Health insurance plans are among the most common benefits offered through employers. The construction industry is notoriously dangerous and physically demanding, so a strong preventative health and general wellness plan is even more critical. 

Businesses with 50 or more employees typically qualify as applicable large employers (ALEs). Under the ACA, ALEs must offer affordable, minimum-value coverage to at least 95% of their full-time or full-time-equivalent workers and those employees’ dependents. While dental and vision insurance aren’t mandated, they can be effective in attracting and retaining talent.

There are several types of health plans contractors can offer, including:

• Health Maintenance Organization (HMO): This limits coverage to medical providers under contract with the carrier, except for during medical emergencies. The employee has to pay for non-emergency out-of-network care themselves.
• Preferred Provider Organization (PPO): While PPO plans offer coverage for out-of-network providers, preferred providers typically come with much lower copays.
• High Deductible Health Plan (HDHP): These plans come with lower monthly premiums but higher out-of-pocket costs. They can be a good option for employees who don’t expect to need regular medical care.

Health savings and flexible spending accounts

Health savings accounts (HSAs) and flexible spending accounts (FSAs) both allow employees to set money aside to cover out-of-pocket healthcare costs. But they come with distinct benefits, eligibility requirements, and contribution limits.

HSAs can only be paired with HDHPs. They’re also employee-owned, meaning that if the worker leaves the organization, they can take any remaining funds with them. FSAs can come with any type of health plan and connect to the employer, so if an employee moves on, the funds go back to the employer.

Both employers and employees can contribute to an HSA, which has higher contribution limits. Remaining funds typically roll over to the next year. FSAs are funded mainly by employee salary reduction, though employers can contribute too, and unused money is forfeited at year end unless the plan offers a grace period or a carryover. 

Life and disability insurance

Construction companies often offer life and disability insurance to help replace lost wages when an employee is injured or sick. This is particularly helpful when a worker’s disability isn’t fully covered by workers’ comp. Life insurance can also help support dependents if the policyholder dies.

Disability coverage programs typically fall into one of two categories:

• Employer-paid: Funded by the company; payouts are considered taxable income
• Employee-paid: Voluntary program funded by the employee through payroll deductions; payouts are considered non-taxable

Retirement savings plans

These plans allow employees to enroll in programs that help them save funds for retirement. Many construction companies offer 401(k) enrollment with employer-matched contributions. This means that the employer matches employee contributions up to a certain amount.

These plans are somewhat customizable. For example, companies can use different contribution percentages, including a dollar-to-dollar contribution (100%) or a partial contribution rate.

Voluntary and supplemental benefits

Supplemental benefits are optional plans that can be funded by the employer, the employee, or both. These programs are typically voluntary, but can contribute to a more competitive package.

Examples of supplemental benefits include:

• Accident coverage
• Critical illness coverage
• Hospital indemnity coverage
• Wellness programs
• Pet insurance
• Mental health coverage

Prevailing wage and fringe benefit allocations

Contractors managing public works projects need to comply with federal and state prevailing wage requirements. Prevailing wage typically has two parts: a minimum base hourly rate and fringe benefits. Contractors have the option to offer these fringe benefits via bona fide packages or a cash equivalent.

Fringe dollars, meaning non-wage compensation, can go toward health and retirement contributions. Workers are allowed to modify their benefits packages during open enrollment, which can impact how contractors allocate benefits across projects and calculate hourly fringe rates.

Top tips to improve the open enrollment process

While open enrollment can be a busy time for construction employers, the following HR strategies can streamline the process to ease administrative burden and give employees more flexibility:

• Communicate benefits clearly: Notifying field crews about deadlines and clearly communicating their benefit options can be tricky, especially for companies managing distributed crews. Opt for a multi-channel communication strategy using SMS and embedded enrollment links, Spanish-language materials, and home mailing for spouse input. 
• Use decision-support tools: Digital platforms like Miter give HR teams more insight into open enrollment and reduce the amount of direct instruction workers need as they weigh their options. Rather than relying on a professional employee organization (PEO), choose a system with a self-service portal that lets employees compare plans and see the payroll deduction for each one before they elect from their own devices.
• Track enrollment progress: Many digital platforms also allow HR teams to track employee progress and send deadline reminders to workers to help prevent late submissions. Good systems also offer in-depth analytics tools to help contractors evaluate benefits performance over the previous year.

Simplify open enrollment with Miter Benefits Administration

Planning for open enrollment across distributed jobsites traditionally brings administrative strain. HR teams have to answer repetitive questions and navigate complex union rules and fringe benefit requirements. But choosing the right construction management system can significantly ease this burden for both HR and employees.

Miter’s Benefits software simplifies open enrollment through a worker-focused self-service portal, helping employees navigate their options without direct supervision. Enrollment runs in English and Spanish on any device, so a crew can complete it from a phone at the jobsite, and elections sync straight to payroll deductions.

Frequently asked questions

Is open enrollment required by law?

Not exactly. The ACA does not mandate an open enrollment period for employer plans. It requires applicable large employers to give full-time employees an effective opportunity to accept or decline coverage at least once per plan year, and Section 125 rules then push most employers into a fixed annual window, because pre-tax elections have to be made before the plan year starts.

How long should open enrollment be for a construction company?

While employers establish their own windows, most construction companies set an open enrollment period of about two to four weeks. Many HR teams with larger, distributed workforces opt for longer windows to allow greater flexibility for individual worker needs.

When is the ACA marketplace open enrollment period?

The individual ACA marketplace is open annually in most states from November 1st through January 15th. However, this is separate from employer-sponsored enrollment periods, which can take place at different times of the year based on company policy.

What happens if a construction worker misses open enrollment?

They may lose the option to enroll until the next year. For companies with passive enrollment options, employees with existing plans may have their benefits from the previous year rolled over to the next. However, if the worker has experienced a qualifying life event, they may be able to extend the window.

What is passive open enrollment?

Passive open enrollment allows prior benefits elections to roll over automatically for workers who fail to enroll within the allotted window.