Employer Who Failed To Update Terminated Employee’s Address Did Not Ensure Receipt Of COBRA Notice

CATEGORY: Client Update for Public Agencies, Nonprofit News, Private Education Matters, Public Education Matters
CLIENT TYPE: Nonprofit, Private Education, Public Education, Public Employers
DATE: Apr 05, 2024

Damion Schinnerer was the Assistant Vice President of Biomedical Engineering at Wellstar, a Medicare/Medicaid certified hospital facility.  Wellstar placed Schinnerer on administrative leave on May 18, 2021 and then terminated his employment on October 1, 2021.  Wellstar asserts Schinnerer was terminated because he mistreated other employees by being disrespectful and abrasive towards them.

Wellstar used a third-party company called WageWorks to send Schinnerer a notice for continued health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA).  WageWorks sent Schinnerer’s COBRA notice to a home address in Marietta, Georgia.  However, Schinnerer moved sometime between the start of his administrative leave in May 2021 and termination on October 1, 2021.  He sold his house in Marietta, Georgia and had all his mail forward to his parent’s address in Forth Worth, Texas.  Since he was on administrative leave at the time of his move, Schinnerer was unable to change his listed address in Wellstar’s system.  He did, however, call Wellstar’s Human Resources to provide his new address around the end of August 2021.  Since WageWorks had sent the COBRA notice to Schinnerer’s former address, he did not receive it until months after his termination.

Schinnerer filed a lawsuit against Wellstar, which included claims of retaliation for engaging in protected activity and failure to timely notify him of his COBRA rights.  COBRA requires plan administrators to use “measures reasonably calculated to ensure actual receipt” of the COBRA notice.  (29 C.F.R. section 2520.104b-1(b)(1).)

Wellstar’s position was that it complied with the COBRA notice requirement because Wellstar timely mailed the COBRA notice through first-class mail.  The district court found that regardless of the way the COBRA notice was mailed, it was mailed to the wrong address.  There was no dispute that Schinnerer had notified Human Resources of his new address by phone.  The district court could not find that Wellstar used measures reasonable calculated to ensure actual receipt of the COBRA notice.  The district court denied Wellstar’s motion for summary judgment on the COBRA notice claim, therefore allowing Schinnerer to proceed with that claim in his lawsuit.

Schinnerer v. Wellstar Health, Inc., 2024 WL 476960 (N.D. Ga. 2024).

Note:  Public agencies are advised to have procedures in place for obtaining the most current residential address information of employees, including employees on leave.  If an employee notifies the agency of a new residential address, the agency should prioritize updating the information in its personnel system, particularly for employees who may be terminated or otherwise separate from employment.

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