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"Mutually Agreed Separation" ?....


Guest MSG
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Hi gang:

I'm one of those faceless ex-employees that you all talk about and work hard to keep legal. The horror, the horror .....

I took a Buyout with my Company last September (08). Buyouts where offered to many before the layoffs became inevitable. I took the buyout with a good deal... Company/Cobra subsidized medical for one full (1) year. As I left the Companies HR folks told me that to qualify and get unemployment I was to tell the powers to be that I was "Mutually Agreed Separated". I got unemployment and the lower rate insurance through Cobra.

Now, I got a question. I'm still looking for work and am starting to worry about Health Insurance costs. If after a year I'm still jobless can I apply for some of that subsidized Cobra ARRA 2009 extension ? As I read it in the ARRA literature... The qualifying events for employees are : Voluntary or Involuntary termination of covered employee for reasons other than gross misconduct".....etc, etc I left in good terms.

I figure I was included in the Voluntary part. But can I still get an ARRA extension after the year is up ? Confusing for us mare mortals....

Thanks,

MSG

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The ARRA says you only get subsidized COBRA if your termination is "involuntary." Voluntary quits do not count. Your facts sound like it might be involuntary. You can ask your former employer if they will provide you with the subsidy. If not, you can appeal to the DOL. There is another string going on the topic of involuntary termination you should check out. I got feedback from a DOL agent on this question:

I spoke with a Dept. of Labor representative Friday on the meaning of "involuntary" termination. The example I gave was an employee who voluntarily accepts an early retirement package offered by the employer, knowing that involuntary workforce reduction is possible if there are not enough voluntary retirements. The Ways and Means Committee website says that involuntary is a termination at the "direction of the employer." The agent agreed that in some situations facts like this would be enough to show that the termination was at the direction of the employer, even though the individuals made an election to leave. He noted that they are getting this question frequently and that the legal staff is working hard to develop a policy that can be applied consistently.

He called this a "grey" area and noted that the employer may have some latitude in determining how to characterize a termination in this kind of situation. However, the DOL is hesitant to issue a policy statement too quickly, as smaller employers would have too much difficulty providing health insurance if access to the subsidy becomes too easy.

The agent also provided me a web address where I will be registered to receive updates on the COBRA subsidy as they become available.

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James B:

Thanks for the follow up.... I worked for the dying newspaper industry. Many many buyouts and layoffs. Our Publisher made it clear if no one took the buyouts that less beneficial layoffs would follow... they did. I guess I'm caught in the "grey area".

Any more opinions ?

Any leads or advise for jobs ?!!

Thanks,

MSG

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The employer can attest that your termination was involuntary. Since they get a payroll tax credit to cover the cost of the COBRA subsidy, they might be willing to do that. However, the subsidy only applies to terminations that occur between September 1, 2008 and Dec. 31, 2009. If you are eligible for the subsidy, they are supposed to send you a notice telling you that you can sign up for it.

It is a fairly weird law and the administration on this thing will surely be a nightmare. As far as a new job, I'd recommend coming up with a few billion dollars and buying up some of the so-called "toxic" assets from financial institutions. Those instruments have been marked down well-below their true value.

If you don't have a few billion laying around - I don't - finding a job in this market is tough. Everyone believes we are in a tough market so we are all hesitating to hire. While the low-hanging fruit is gone, there are lots of opportunities in a down market. People still want to earn a living and businesses want to make money, regardless of the economy. In law practice we have to retool ourselves to find where our skills can be used in this economy. It isn't much different than what you are facing.

Best of luck.

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Thanks James. We shall see if I get something from the Company. Seriously, the folks managing the Cobra for the Company have a lot to be desired. Not very professional in my opinion. Nothing in dispute but just amateurish correspondence and forms. As for the job search... I'll find something. Later, MSG

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