How contribution amount and type are determined

All employees must participate in the HCSP adopted by their employer or bargaining unit. Only negotiated and agreed upon contributions are allowed.  

  • If bargaining unit: contributions must be agreed upon by both the bargaining unit and employer and written into the collective bargaining agreement or Memorandum of Understanding (MOU).

  • If non-union: contributions must be agreed to by the employer and included in written personnel policy.
     

Contribution guidelines

  • Most employers will use Plan Service Center (PSC) to remit HCSP contributions (as well as MNDCP contributions).

  • Contributions are not subject to state, federal or FICA taxes; therefore, there is no tax reporting.

  • No contribution minimum or maximum. Exception: a 15% maximum payroll contribution exists for unrepresented and contract employees. 

  • No age limit at which time contributions can no longer be made to the Plan.

  • Ongoing mandatory employee contributions should be calculated based on the total gross income.

  • Submitting contributions for employee who returns to work: if using Plan Service Center (PSC) to submit contributions for an employee who has returned to employment, submit contribution under "active," regardless of the employee's status (active or terminated). This will prevent employees from accessing contributions that result from their re-employment.

  • Garnishments: since HCSP requires mandatory contributions, the contribution must be taken prior to garnishments. HCSP payroll deductions are taken into account for the calculation of disposable income calculations for garnishments.

  • Military leave pay: if pension plan contributions are deducted from military leave pay, then HCSP contribution should be deducted as well.