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Are there penalties for late COBRA notices to former employees?

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Employers are seeing increased lawsuits alleging deficient COBRA election notices, with penalties of up to $110 per person per day. Many employers rely on third-party vendors to provide notices which may fail to include mailing address for payments, plan administrator’s identity, explanation of how to enroll, and the actual election form to elect coverage. COBRA notice litigation is directed at the employer or plan sponsor, not the vendor.

Meet the Expert

Karen Shannon is Vice President of Business Consulting/CHRO for Ollis/Akers/Arney. Karen has served in senior leadership positions in banking and human resources for over 30 years. She and her team provided HR services to 5,000 employees across the US, United Kingdom, India and Mexico. Today, she works with world-wide clients on key business and HR strategies which have resulted in cost savings upward of $7 million.

Karen received her MBA and BA in Business Administration and Economics from Drury University. She is a graduate of Leadership Missouri, past president of the Junior League, and was appointed to the Board of Trustees for banker education for the Missouri Bankers Association. She has served on the Board of Directors for numerous organizations and is a regular presenter at national and regional conferences. Karen was recognized in 2000 by the Springfield Business Journal in its inaugural class of the Most Influential Women in Business.

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