Fulgencio Law Brings COBRA Violation Class Action Against National Trucking Company
Fulgencio Law has filed a putative class action lawsuit against national contract carriage service company, First Fleet. The lawsuit alleges that First Fleet failed to provide employees with mandatory notices of their right to continued healthcare coverage. The lawsuit, filed in Florida, cites suspected violations of both the Employee Retirement Income Security Act of 1974—ERISA—and the Consolidated Omnibus Budget Reconciliation Act of 1985—COBRA.
The Plaintiff’s employment as a driver for the defendant was terminated in January 2017. As the man was reportedly not terminated for gross misconduct, the end of his employment is considered a “qualifying event” under the scope of COBRA’s regulations, which, among other mandates, require plan sponsors who employ more than 20 employees on a typical business day to provide notice of and allow for the election of continued healthcare coverage following a “qualifying event.”
“[The defendant] authored and disseminated a notice that was not appropriately completed, deviating from the model form in violation of COBRA’s requirements” … “which failed to provide [the plaintiff] notice of all required coverage information and hindered [the plaintiff’s] ability to obtain continuation coverage, as explained further below.”
The plaintiff alleges the COBRA notice he received from First Fleet was not only “woefully late,” but appeared to have been taken straight from the company’s employee handbook. More specifically, the lawsuit says the defendant failed to provide the plaintiff with COBRA notice until January 2018 even though the man was terminated in September the previous year.
A copy of the complaint can be found here: https://www.classaction.org/news/lawsuit-first-fleet-inc-failed-to-relay-to-employees-erisa-cobra-healthcare-rights#embedded-document
More information can be found here: https://www.classaction.org/news/lawsuit-first-fleet-inc-failed-to-relay-to-employees-erisa-cobra-healthcare-rights
This case provides an important reminder to employers and plan administrators that COBRA election notices must not only be timely sent to qualified beneficiaries, but the content of the notices must also contain all the requirements mandated by the COBRA regulations. In fact, employers and plan administrators that fail to meet COBRA’s notice requirements may be subject to statutory penalties of up to $110 per day, per violation. Particularly in the cases of mid-sized and large employers, these fines can significantly add up and become very costly.