Because actual contribution income fluctuates with the level of covered work, multi-employer plans may need more reserves than plans with more consistent funding. The number of hours that employees must work during a given time period to be eligible for coverage is negotiated with the employer. While these plans are established through collective bargaining, they must cover all employees that are covered by the bargaining agreement, not just the union members. They can, and often do, also cover employees of the health plan itself, employees of sponsoring unions, and, in some instances, exempt employees of the contributing employers. For plans established after 1985, federal law requires that at least 90 percent of the plan participants be covered by collective bargaining agreements.
Plans established earlier have stricter union participation rules.
The collective bargaining agreement specifies a minimum number of hours, days or months that union members must work to meet the eligibility requirements of the plan. That number is typically less than the number of hours actually worked. For example, the eligibility requirement for union members could be that they work at least 25 hours per week. In reality, the members may work 40 hours per week. Portability and Continuation of Coverage One of the biggest advantages of Taft-Hartley plans is their portability.