Walmart Must Face COBRA Notice Class Action Lawsuit

A Florida federal judge has ruled that Walmart must face a class action lawsuit claiming that the retail chain did not sufficiently inform workers of their COBRA health benefits.

Last Thursday, U.S. District Judge Jose E. Martinez denied Wal-Mart Stores Inc.’s efforts to have the COBRA class action lawsuit dismissed.

Judge Martinez disagreed with Walmart’s argument that its explanation of benefits was indeed clear enough, and its claim that the employee who filed the Walmart health care class action lawsuit had not been actually injured by its actions.

The Walmart COBRA class action lawsuit was filed by Jamie Bryant in November 2016. According to Bryant, she was fired in April 2016 after working as a store manager since 2009.

Allegedly, after she lost her job, Bryant received a notice of her continuing health benefits under COBRA, the Consolidated Omnibus Budget Reconciliation Act, which gives individuals health coverage if they lose their job for reasons other than gross misconduct, or if their hours are reduced.

According to the Walmart class action, the notice that Walmart sent to her notifying her of benefits violated ERISA, the Employee Retirement Income Security Act, because it allegedly did not inform her of her rights under COBRA. Bryant argues that the information was confusing and not easily understandable, as required by ERISA.

The Walmart class action states that Walmart’s notice was confusing on a number of counts, including that a spouse may continue coverage under COBRA, and a child’s legal guardian can continue coverage for a minor child under COBRA.

Bryant claims that she was injured by Walmart’s failure to provide a clear explanation of benefits because she and her children experienced a lapse in coverage.

In Walmart’s bid to have the COBRA class action lawsuit dismissed, the retail chain argued that Bryant was not injured because she and her children did not suffer a loss in coverage, because they had access to health insurance through Bryant’s domestic partner.

However, Judge Martinez disagreed with Walmart’s claim, determining that Bryant did indeed experience a loss in coverage and did suffer actual harm. Judge Martinez also agreed with Bryant that Walmart’s notice was not written clearly, rejecting Walmart’s argument that the notice was easy to understand.

According to Bryant, the notice violates COBRA requirements because it does not include information on how to contact the health care plan’s administrator.

In further attempt to have the Walmart COBRA notice class action lawsuit scrapped, Walmart argued that it should not be held responsible under ERISA, which Bryant claims was violated. Walmart argues that it is just the employer sponsor of the plan and not the plan administrator, so it should not be liable.

However, Judge Martinez agreed with Bryant that Walmart could be held liable because Walmart had not listed a plan administrator on the notice of benefits and would therefore be named as the de-facto administrator, per COBRA’s requirements.

Bryant is represented by Brandon J. Hill and Luis A. Cabassa of Wenzel Fenton Cabassa PA.

The Walmart COBRA Notice Class Action Lawsuit is Jamie Bryant v. Wal-Mart Stores Inc., Case No. 1:16-cv-24818, in the U.S. District Court for the Southern District of Florida.

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