Home Depot Faces Class Action Lawsuit Over COBRA Rules

A former Home Depot employee has filed a class action lawsuit against the home improvement store chain, alleging the company violated federal labor law and cost the man continued health coverage after he left his job.

The man filed suit in the U.S. District Court for the Middle District of Florida, Tampa Division on July 9. In his civil complaint, he says Home Depot failed to provide him with all the information he needed in order to keep his health insurance coverage after he was let go from the company. Home Depot’s actions constituted a violation of the U.S. Department of Labor’s model Consolidated Omnibus Budget Reconciliation Act, or COBRA, the lawsuit claims.

“Home Depot partially adhered to the (legal requirements), but only to the extent that served Home Depot’s best interests,” the class action lawsuit alleges.

COBRA Rules Explained

Companies with 50 or more full-time workers are required by law to offer subsidized health insurance to eligible employees. When a worker loses eligibility – leaves the company or works fewer than the required number of hours – the company can stop contributing to the cost of the insurance premiums. But thanks to the Consolidated Omnibus Budget Reconciliation Act (COBRA), the worker can continue to be covered by the former employer’s plan, for up to 18 months, if he or she makes the payments.

The U.S. Department of Labor sets the COBRA rules and mandates that employees receive proper notification of their rights to the continued health insurance coverage. Federal officials have acknowledged the notifications can be difficult for affected employees to understand, so the department created a “model” notice that employers can use to meet the requirements.

Allegations Against Home Depot

In the case against Home Depot, the plaintiff says he worked for the company for 19 years before being terminated unexpectedly in July 2019. Afterward, the plaintiff says he received a COBRA notice from Home Depot that did not explain how to enroll in the continued health coverage plan and did not include an election form.

The complaint also says Home Depot’s COBRA notice did not identify the plan administrator or clearly identify the health plan offered for continuation.

Overall, the plaintiff’s lawsuit says, Home Depot did not use the labor department’s model notice and broke COBRA rules by sending a version that “confused and misled him” and was not written in a way the average person could understand. As a result, the former employee was not able to enroll in the continued coverage available to him and he later incurred medical expenses because of that, he claims.

The lawsuit accuses Home Depot of “pushing terminated employees away from electing COBRA” in order to save the company money.

Based on his experience, the plaintiff suspects many other former Home Depot employees received the same notice he did, and thus he is seeking to have the lawsuit approved as a class action.

Numerous COBRA Rules Lawsuits

The Home Depot class action lawsuit over COBRA rules is at least the sixth class action brought against a major U.S. company over similar claims. Former employees of Southwest Airlines, the Hershey Company, Starbucks, Citigroup, and PepsiCo., among others, have filed similar class action lawsuits.

In March, officials with the Society for Human Resource Management warned the group’s members about the“household-name entities” that have been sued in cases involving companies that did not use the Department of Labor’s model COBRA notice.

The Home Depot Class Action Lawsuit is Case No. 8:20-cv-01561, in the U.S. District Court for the Middle District of Florida, Tampa Division

Join a Free COBRA Class Action Lawsuit Investigation

If you received a COBRA notice that did not fully disclose your rights and how to retain your health insurance following separation from your job, or you received no notice at all, you may be qualify to join this COBRA notice class action lawsuit investigation.

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This article is not legal advice. It is presented
for informational purposes only.