When Zenefits benefits open enrollment glitched and auto-enrolled employees into wrong plans and the audit steps that repaired coverage
Open enrollment is already one of the most chaotic times in any HR department. There’s paperwork, deadlines, and lots of questions. It’s like tax season, but for employee benefits. Now imagine you’ve done your part—submitted your benefits selections through your HR software—and then the system decides to enroll you in the wrong plan. That actually happened with Zenefits during one very glitchy open enrollment season.
TL;DR
Zenefits had a glitch during open enrollment that caused many employees to be auto-enrolled into the wrong benefit plans. This included messed-up health, dental, and vision coverage. Employees were understandably unhappy and confused. An audit was conducted, errors were found and corrected, and things eventually got back to normal—though not without some serious detective work.
So… what went wrong?
During one open enrollment period, Zenefits experienced a system bug. It caused their software to override employee selections and pushed people into default or incorrect benefit plans. This included:
- Health plans with higher premiums
- Dental plans they didn’t choose
- Vision plans missing entirely
Employees logged in expecting to see the plans they had picked. Instead, they saw coverage they didn’t want—or worse, no coverage at all.
This affected all kinds of organizations: tech startups, small businesses, and even medium-sized companies. If they used Zenefits, they were in the danger zone.
Wait… how could this kind of thing happen?
HR tech is complicated. Zenefits uses data automation to connect employees, employers, insurance carriers, and payroll systems. Sometimes, a small software update or code error can cascade into something big.
In this case, the glitch came from how the system saved benefit selections. It didn’t always lock in your choices during final submission. So, when data was sent to insurance carriers, it pulled default info or partial data instead of your real choices. Think of it as hitting “Save” on a Word doc—and then reopening it to find half the text missing.
Panic. Confusion. Insurance chaos.
Once the glitch became public, chaos spread. HR teams got flooded with questions:
- “Why am I now on a PPO when I chose HMO?”
- “Where did my dental coverage go?”
- “I never picked this expensive plan!”
And some employees didn’t even notice until they tried to use their benefits. Imagine visiting a doctor only to find out your coverage isn’t valid. Yikes.
The detective work begins: The audit
Zenefits realized it had a major situation on its hands. Enter: the audit.
Audits are like the Nancy Drew of data messes. Here’s what they did:
- Identify affected users. They went through logs to pinpoint every employee with mismatched plans.
- Compare submissions. They compared what people selected versus what was actually submitted to carriers.
- Sort by carrier and product. Health, dental, vision, life—all had to be checked with individual providers.
- Work with insurance partners. Zenefits coordinated with insurance companies to retroactively fix enrollments.
- Communicate with HR teams. Employers were updated with priority fixes and timelines.
This wasn’t a one-day fix. It took weeks of back-and-forth between Zenefits, carriers, companies, and employees.
Repairing the damage
Thankfully, most of the employees had their correct benefits reinstated. In some cases, adjustments were made retroactively. That means if someone paid out-of-pocket due to the wrong coverage, they could sometimes get reimbursed after the fixes went through.
Zenefits also took a few key steps to prevent this from happening again:
- Improved system validation — more checks before data gets submitted
- New audit tools — tools that can detect mismatches before they go live
- Manual override options — benefits admins could now lock in choices more securely
Lessons learned (the hard way)
Open enrollment is stressful enough. A tech glitch is the last thing anyone needs. But this glitch gave the HR world some valuable takeaways:
- Always double-check plan confirmations. Print them or screenshot them, just in case.
- Talk to HR if anything looks weird. Don’t wait until you need to use the benefit.
- HR tech is helpful—but not perfect. Glitches happen, even with powerful tools.
Zenefits’ response and recovery
To their credit, Zenefits took full ownership. They issued notices, responded to every reported case, and rolled out software patches. They also trained customer support teams to handle benefit inquiries more efficiently.
PR-wise, they got some flak. But users appreciated the transparency. Not many companies would say, “Yeah, we messed up your health plan. But we’re going to fix it.”
The human side of benefits
What this story really highlights is how personal benefits are. These aren’t just checkboxes or numbers. Health plans affect how and where people get care. Vision insurance means someone can afford glasses. A glitch might seem “technical,” but it has real human consequences.
That’s why benefits auditing is such serious business. One wrong line of code can mean someone’s medication isn’t covered. Or someone delays going to the dentist.
How to stay safe during open enrollment
Using HR software like Zenefits can make your life easier—but don’t treat it like magic. Here’s how to make sure your choices stick:
- Log in early. Don’t wait until the last day. Bugs pop up under pressure.
- Double-check your confirmation emails. You should get a summary of selections.
- Save a copy of your elections. If there’s a “Print” or “Download” option—hit it.
Also, if your company uses external brokers, talk to them too. They often get benefit summaries from carriers and can confirm your selections processed correctly.
Final thought
Zenefits’ glitch turned open enrollment into a headache. But with a thorough audit and some quick fixes, things got smoothed out. It’s a reminder that tech alone can’t replace the human role in HR. The best setup? Smart tools, supported by even smarter people.
Next open enrollment season, take an extra 10 minutes to double-check your plan. It might save you hours of calls with your insurance provider later. And if your benefits look strange—ring up your HR team ASAP. Better safe than glitchy!
