Your employer has up to 30 days after termination to provide proper notice of COBRA benefits.

Generally, the civil penalty for failure to provide benefits is up to $110.00 per day per affected plan participant, to be levied against the plan administrator. (Section 502(c)(1) of the Employee Retirement Income Security Act of 1974 (“ERISA”).)

Additionally the employer can be liable for damages arising from failure to provide medical coverage, attorney’s fees, and court costs.

In Share v. Panhandle Motor Services Corporation, a District Court-imposed damages of $122,808 for reimbursement of medical expenses and $18,151 for attorneys’ fees. The District Court also assessed a civil penalty of $4,035 (incorrectly referred to by the Fourth Circuit as “punitive damages”) for failure by the employer (as plan administrator) to provide the COBRA notice.”

Additionally, of little use to the employee, but still very important during settlement discussions, keep in mind that the IRS may impose an excise tax of an additional $100.00 per day upon employers or insurers failing to comply with COBRA requirements. (Section 4980B(b) of the Internal Revenue Code of 1986.)

Contact Ricotta & Marks, P.C.

Call our Queens employment attorneys at 800-240-9269 or contact us online to schedule your free initial appointment today.

Additional Resources

(Section 502(c)(1) of the Employee Retirement Income Security Act of 1974 (“ERISA”))
Shade v. Panhandle Motor Services Corporation, 91 F.3d 133 (4th Cir. 1996)
(Section 4980B(b) of the Internal Revenue Code of 1986)