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Employer May Rely on Address Provided by Employee

by | Jun 21, 2024 |

In Anaya v. Birck, the United States District Court for the Northern District of Illinois ruled that an employer met its COBRA notification requirements even though it did not send a terminated employee’s COBRA election notice to his current address.

Law.  COBRA requires employers to notify employees of their right to continue healthcare coverage following termination of employment.  Specifically, an employer is required to notify its plan administrator within 30 days of an employee’s termination, and the administrator is required to provide a COBRA election notice to the employee within 14 days after receiving the employer’s notification, a total of 44 days if the employer is also the plan administrator.  COBRA provides the employee with a private right of action to sue an employer if the employer fails to provide a COBRA notice to the employee.  COBRA regulations require employers to use measures “reasonably calculated” to ensure actual receipt of COBRA election materials by plan participants.

Facts.  An employee was terminated and later sued his former employer, claiming, among other things,  that he had not received the required COBRA election notice when the employer failed to send the notice to his current address.  The employer countered that it had mailed the notice to the address that had been provided by the employee.

In support of his argument, the employee contended that, regardless of the address on file, the employer should have known the notice was sent to his old address because the employer’s CEO had been to the employee’s new home.

Citing prior rulings, the court noted that, “the issue is not whether the former employee actually received notice; the issue is whether the plan administrator caused the notice to be sent in a good faith manner reasonably calculated to reach the former employee.”  It found that sending the notice by first class mail addressed to the former employee’s last known address is an acceptable method of notification.

The court then ruled in favor of the employer, explaining that even if CEO knew where the plaintiff lived, there was no evidence that the CEO knew that the plaintiff could not also receive mail at the address that was on file.  Further, the court explained that to act on such knowledge, the CEO would have had to reach out to the employee and instruct him to change his address or to unilaterally change the address in the health insurance system without the employee’s permission.  It ruled that, “Good faith does not require such measures.”

Based on the foregoing, the court determined that the employer was not required to update the employee’s address in its system on its own accord.  Rather, it found that mailing the notice to the employee’s address on file was sufficient to satisfy its COBRA statutory obligations.