Employers are seeing an increase in lawsuits from former employees alleging deficient Consolidated Omnibus Budget Reconciliation Act (COBRA) election notices, with statutory penalties of up $110 per person per day. These lawsuits are generally class actions and can result in significant attorneys’ fee awards for successful ex-employees. The fact employers are struggling to comply with COBRA notice requirements means employers should brace for increased election notice litigation.
“The DOL is ‘keeping an eye’ on the need for additional COBRA guidance, but other issues have taken priority.”
– Elizabeth Schumacher, deputy director of the DOL’s Division of Regulations and Standards
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