November 2024 Iowa Q&A roundup

Q          Can employers that don’t have to comply with the Family and Medical Leave Act (FMLA) have to continue health insurance coverage for employees when they’re on workers' compensation leave? Must they give employees the option to pay premiums and stay on the plan, or can they end their coverage and offer Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage?

If you aren’t required to comply with the FMLA, you may have other laws and regulations that impact benefits offered during leave, such as the Americans with Disabilities Act (ADA)/the Americans with Disabilities Act Amendments Act (ADAAA), the Pregnant Workers Fairness Act (PWFA), and state laws. 

You also have to consider the terms of your insurance contract and how long coverage may be offered without COBRA for someone who isn’t working the minimum hours. In general, it can be problematic to remove people from insurance, especially for short-term leaves, given the time lapse we may see in COBRA. It can also create concerns that those who are disabled are being treated differently, as you wouldn’t end benefits for someone on vacation. So your first step is to understand your insurance contract and then work from there.