HR people, I have a question

A friend called to ask me these questions b/c I'm a lawyer, but it is the HR people who have the answers!!!

If a company goes out of business, can the employees still be covered under COBRA for health insurance? In the situation my friend is asking about, the employer is saying no and I am not sure what the insurance company has said.

If the company already took $$ out of paychecks for the employee's contribution to health benefits for this month, can they later return the money and tell the employee, "sorry, health benefits ended with the end of last month because we are going out of business"?

ETA: What about vacation pay?

Also, I am not sure whether the company will be filing bankruptcy.

Message edited 1/21/2008 6:32:43 PM.

Re: HR people, I have a question

bump- anyone??

Re: HR people, I have a question

Are they filing bankruptcy and reorganizing? Or are they going out of business completely? If the latter and they discontinue the plan then COBRA may not be required. She get a copy of the plan document and call her insurance company.

COBRA

Re: HR people, I have a question

I believe if the company is going out of business they are terminating their plan therefore there is no COBRA to be offered, unfortunately

Re: HR people, I have a question

My company just closed, and we were told our health insurance lasts as long as our severenace does which I have never heard before. I always thought it lasted until month end. I believe Cobra was offered after that.

Re: HR people, I have a question

Thanks everyone. I don't even think there was severance. Just Buh-Bye!!!! The company is definitely closing and not reorganizing.