Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). Despite the title of the statute, this law is most significant because it establishes the rights of many employees (and their dependents) to continue coverage under their employer’s group health care insurance even after they cease working for the employer. The rights are significant because they allow employees access to group health plan rates, generally far less expensive than individual health plans. COBRA specifies that employers who employ at least 20 employees must allow the employees to continue coverage under the employer’s health care insurance plans if certain qualifying events occur. The most common of these are termination of employment, or a reduction in the employee’s work hours, that would ordinarily render the employees ineligible for employer health care coverage. In the case of dependents, qualifying events include divorce or legal separation of the employee and his or her spouse, the death of the employee, or simply a dependent child of an employee losing dependent status, usually because he or she reaches a certain age. When these events occur, the affected employees and their dependents covered by the employer’s health insurance plan must be allowed to continue their employer-provided health insurance for a specified period, usually 18 months, provided the employees are willing to pay the premiums for the continued insurance. COBRA does not require the employer to continue pay any portion of the premium, so COBRA coverage, though far less expensive than an individual plan, may still be quite costly for the employee or dependent.
COBRA regulations contain detailed notification requirements and time frames that both employers and employees must meet.
The Sarbanes-Oxley Act of 2002 was passed in response to abuses in corporate governance by such companies as Enron and WorldCom. The Act added a new disclosure provision, requiring that employers notify employees of any “blackout” periods–or times when employee may not be able to trade in their accounts of their employer stock. The Act also requires officers of a company to pay back any profits they received from purchase or sale of company stock during such a blackout period.