Employers who offer these types of benefits must provide employees (and, if covered, their spouses and dependents) with notice of their continuation rights when an event occurs that would otherwise cause a loss of coverage. The covered individual may elect to obtain for a limited period of time continuation of the coverage they had before the event. The individual may be required to pay up to 102 percent of the cost of the premium for their coverage. COBRA requirements are complex. Firms that offer group health insurance to their employees should consult with legal counsel to assure that their notice procedures conform to federal and state law. Life Insurance There is no right under federal law to continue employer-provided life insurance coverage after employment terminates. Under Minnesota law, however, group term life insurance policies issued within the state must permit covered employees who are voluntarily or involuntarily terminated, incur a reduction in hours to the point where they are no longer eligible for coverage, or are laid off, to elect continuation of the coverage for themselves and their dependents. Coverage ends after 18 months or on the date on which coverage is obtained under another group policy, whichever occurs first. As with health insurance continuation coverage, the employee can be required to pay the cost of the life insurance continuation.
PLANT CLOSINGS
FEDERAL LAW The federal Worker Adjustment and Retraining Notification Act (WARN) applies to employers of 100 or more full time employees. Employers with fewer employees are encouraged to comply with the spirit of the law, although they are not bound by it. The federal law requires employers to provide 60 days‘ notice to several entities before ordering a plant closing or massive layoff. These entities include affected employees or their collective bargaining representative, the state dislocated worker unit (in Minnesota, the Department of Employment and Economic Development and its Rapid Response Team, listed in the Resource Directory section of this Guide), and the chief elected official of the unit of local government in which the business is located. If the firm is situated in more than one locality, notice must be given to the local governmental unit to which the employer pays the highest taxes. Employers who violate the law may be liable to employees for back pay and benefits for which they would have been eligible under an employee benefit plan. An employer who fails to notify the local governmental unit of the plant closing may be liable for a civil penalty of up to $500 per day of violation.
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