Unfortunately, this is in fact legal. Remember, health insurance--despite the recent health care bill--is still not something that companies or are mandated to provide (they can opt to pay a penalty, which penalty is less than the cost of the insurance)--and unions are not obligated at all to provide it. That means that the insurance offered may have any requirements or stipulations that do not otherwise contravene the law, such as discriminating against pre-existing conditions. A common--and legal--requirement is that if a family member has insurance available through his or her own employment, he or she must take that insurance and cannot be on the family plan of our spouse. It's unfair, but it is legal.