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Q: As an employer, do we have to continue COBRA coverage for an ex-employee who was found by a judge to have been fired rightfully for gross misconduct? She is on our COBRA plan right now however; we are getting quotes for new insurance carriers. Did we ever have to offer COBRA to her anyway due to her misconduct? Please let me know.
A: Although illegal or dangerous acts committed in the workplace are likely to qualify as gross misconduct, the acts need not be criminal or otherwise unlawful in nature. In some instances, even acts that occur away from the workplace have qualified as gross misconduct. A definition widely used by the courts goes something like this: Acts of gross misconduct are intentional, wanton, willful, deliberate, reckless, or in deliberate indifference to an employer's interest. Often, acts that will prompt an employer to terminate an employee are those done in deliberate violation of the employer's known standards. However, those acts may not constitute gross misconduct for COBRA purposes unless they go beyond simple negligence or incompetence.
As an employer you do not have to offer COBRA to an individual if the qualifying event is due to gross misconduct.
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