Definition of "Legal Separation" for COBRA Purposes

[401 Chaos]

I understand that COBRA does not define the term "legal separation" for qualifying event purposes. It is also my understanding that the family law rules of many states also do not formally recognize the concept of a legal separation. That is to say, although parties may be "separated" and living apart, they are still viewed as legally married until the final divorce. Although there are some states that may have a classification of "legal separation" or certain forms of divorce like a "divorce from bed and board" that might rise to a "legal separation," that appears to be a minority.

Given the confusion over the lack of an express definiton of "legal separation" and participants' status during a usual "separation period" etc., I was curious how many worked with plans that attempted to provide a definition of the term "legal separation" and how such a definition was drafted so that it is broad enough to cover multiple states and still provide some meaningful clarification (e.g., I don't think saying something like "legal separation as may be recognized under applicable state law" really helps much.)

[J Simmons]

For states that do recognize 'legal separation' as well as divorce, in those states treat someone as legally separated if they meet that state's definition.

For states that do not recognize 'legal separation', only give COBRA rights for divorce. Until then, they are married.

[401 Chaos]

John,

Thanks. That's pretty much what we have done in the past (and maybe the best that can be done). The problem comes up when participants see that language and try to drop spouses just because they are separated. In most cases, those sorts of separations in anticipation of divorce do not constitute legal separations. Frankly, even in states that do recognize legal separations as something of a distinct classification, the grounds for that don't seem to be very clear. Anybody used to seeing language that might try and explain or put some parameters on the legal separation requirements so that participants have a bit more of an understanding?

[CEB]

We have very specific language in our plan that in the event of a divorce or legal separation, the plan administrator has the right to request supporting documentation for the event. We always require, when applicable, a copy of the court approved legal seperation papers or the divorce decree. The key word is "legal" which usually means there will be some type of paper trail in the court system.

[401 Chaos]

CEB,

Thanks for the additional response. That is a helpful suggestion.

We've batted the issue around for our state with various family lawyers and there seems to be a range of opinions as to what sort of court documentation (short of final divorce decree) might justify a legal separation. For example, there is thought (and I think some case law support for) that a "divorce from bed and board"--apparently an antiquated and now rarely used form of separation / divorce--constitutes a legal separation even though it is not a final divorce. There is also some thought that court orders enjoining individuals from having certain types of contact with the spouse going forward (e.g., domestic violence / live apart orders) might rise to the level of legal separation but there does not seem to be any consensus on those sorts of situations.

One thought we've had given the lack of clarity under our state law was to simply limit the qualifying event to "divorce" but this would seem to me to possibly be prohibited by the COBRA rules unless the Plan Administrator could really determine that there was no possible classification of "legally separated" under applicable state law. Of course, that becomes all the tougher when multiple states are involved.

Anybody have thoughts on whether the plan could simply drop the "legal separation" component from the qualifying event list and still comply with COBRA.

[CEB]

Here is a great resource for legal separation by state: http://www.womansdivorce.com/state-divorce-resources.html

(Also: All states except Delaware, Florida, Georgia, Mississippi, Pennsylvania, and Texas recognize legal documentation of separation. That is why we request "documentation" to support the separation.

I haven't found any legal separation definitions where the word "court" has been left out of the definition. (wiki has a great definition of legal separation). I don't think living apart & trial separation equal "legal" separation. I am not a lawyer, so take this suggestion with a grain of salt. Even in California the individual has to file with the courts and you know how california laws can be tricky.

What is even more confusing is in the event the couple decides to stay married under a legal separation order, some states do not require them to do anything further to remain married. So what is the event to add the dropped dependents back on to the plan, open enrollment?

I tend to think domestic abuse rules deal more with IRS tax filings than legal separation. Restraining orders are usually limited to a certain amount of weeks (I guess that depends on the state).

Here are some resources I use over and over again to determine eligibility to remain on the plan:

http://www.taxalmanac.org/index.php/Sec._152

http://www.dol.gov/ebsa/newsroom/fscobra.html

p.s. 401k Chaos (our plans do not define it, maybe that is a good thing??) And another question, what about annulments? This is a very good discussion....