US Employees Overseas

[Guest Bill Johnson]

A US citizen on US payroll is working at one of our overseas locations. He is covered under US benefits. We decide to make him an employee of our local subsidiary and on the local payroll. The local subsidiary does not offer medical or dental. Do we owe him a COBRA notice? My impression is that no termination of employment or reduction in hours has occurred, since he is still employed by a member of the controlled group, therefore, no qualifying event. It would seem like transfering an employee to a US location or subsidiary which does not offer benefits. Does anyone have similar situations that you've had to handle?