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COBRA Subsidy and Unemployment Benefits – Extending the Extension

On April 15, 2010, President Obama signed the Continuing Extension Act of 2010, extending eligibility for unemployment and COBRA benefits which were previously extended by the Temporary Extension Act of 2010. 

With regard to COBRA, the bill extended the eligibility deadline for the COBRA subsidy from March 31st to May 31st.  This subsidy allows workers who lose their jobs on or before the deadline to continue health benefits for 15 months by paying only 35 percent of the premium.  Workers can obtain coverage for three additional months at the full COBRA rate of 102 percent.

As for unemployment, the application deadline for Federal Emergency Unemployment Compensation (which extends UI benefits by an additional 33 weeks beyond state benefits) was extended from April 5, 2010, to June 2, 2010.  The claims period, which was to end September 4, 2010, now ends November 6, 2010.  Also, the Federal Additional Compensation program, which adds $25 per week to state unemployment benefits, was extended for the same period.

This is the second extension of benefits originally provided by the 2009 American Recovery and Reinvestment Act.  There is proposed legislation that would extend these benefits through the end of the year, but it is unclear whether there is enough support in Congress for it to pass.  Nevertheless, until we see a significant change in the unemployment figures, it is likely this is not the last “temporary” extension.  We will continue to keep you informed of further developments.

Brody and Associates regularly advises management on complying with state and federal employment laws including wage and hour laws.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.965.0560.