COBRA Notice Violation EBSA Formal Complaint

The situation

An ex-employee is laid off, loses group health coverage, and never receives the COBRA election notice that their former employer's plan was legally required to send within 14 days. They scramble to find individual coverage on the ACA marketplace, pay higher premiums, or go uninsured, not knowing they had a legal right to continuation coverage and that the failure to send the notice exposed the plan administrator to $100-$200/day in IRS excise taxes and $110/day in DOL ERISA penalties. Most ex-employees don't know the violation occurred, don't know which agency handles it (EBSA, not the state DOI), and don't know that the ERISA § 502(c) statutory damages path exists alongside the DOL administrative complaint route.

Who receives this

Recently separated or laid-off employees from companies with 20+ employees who either never received a COBRA election notice or received it more than 14 days after the qualifying event, most commonly termination, reduction in hours, or divorce/separation from a covered spouse. Specifically valuable for ex-employees who: (a) had significant medical expenses during the gap and needed COBRA coverage that was never offered; (b) want the IRS excise tax and DOL penalties applied to deter the plan administrator; (c) are in states without Cal-COBRA or NY/NJ state mini-COBRA for the relevant employer size.

Why the agency will not advise you

The plan administrator who failed to send the election notice cannot advise the ex-employee on how to file a COBRA notice violation complaint against the plan. ERISA attorneys take these cases but typically require a retainer for the § 502(c) statutory damages path; the DOL EBSA administrative complaint route is free but has no guided documentation tool. The self-serve gap is specifically the complaint generation + penalty calculation + dual-path explanation (DOL administrative vs. federal court), which neither the DOL nor private counsel provides at the individual ex-employee level without engagement.

Key facts, with sources

• ERISA § 606 and 29 CFR § 2590.606-4 require group health plan administrators to provide a COBRA election notice to qualified beneficiaries within 14 days after the plan administrator receives notice of a qualifying event (which the employer must notify the plan of within 30 days). Failure to provide the notice subjects the plan administrator to IRS excise taxes under IRC § 4980B ($100/day per individual, $200/day per family, with a minimum $2,500 penalty per qualified beneficiary per year) and DOL civil enforcement under ERISA § 502(c) ($110/day per day per beneficiary, enforceable by DOL or by the participant in federal court). Source: COBRA Continuation Coverage — U.S. Department of Labor EBSA · Model COBRA Continuation Coverage Election Notice — DOL
• The DOL EBSA provides general assistance through the Ask EBSA online portal (askebsa.dol.gov) and a toll-free help hotline (1-866-444-3272). EBSA's FY2025 enforcement actions recovered over $714 million for plans and participants. However, the Ask EBSA complaint portal is a generic webform, it does not calculate penalties, identify the specific violation type, or generate supporting documentation. No private self-serve COBRA violation complaint generator was found. Source: How can we help you? — Ask EBSA Portal · How to File an EBSA Complaint — LegalClarity
• COBRA notice violations are common: employers with 20+ employees who use third-party COBRA administrators (e.g., HealthEquity, WEX Health, Benefytt) are responsible for ensuring timely notices, but termination-related handoffs frequently result in late or missing notices. Attorneys who handle ERISA § 502(c) litigation confirm that most ex-employees are unaware they can sue for statutory damages, the information asymmetry is extreme. The plan administrator cannot advise the departing employee on how to file a complaint against the administrator. Source: Employer's guide to COBRA initial and election notices — EBM · COBRA Election Notice and Form — Katten Muchin Rosenman

When to bring in a professional

Self-serve responses fit routine cases: clear facts, amounts a business can absorb, and a deadline still ahead of you. Bring in a licensed professional when the amount at stake is large relative to their fee, the facts are genuinely disputed, criminal exposure is possible, or the deadline has already passed. A short paid consultation to sanity-check your plan is often worth it even when you handle the filing yourself.

All sources for this guide

1. COBRA Continuation Coverage — U.S. Department of Labor EBSA
2. Model COBRA Continuation Coverage Election Notice — DOL
3. How can we help you? — Ask EBSA Portal
4. How to File an EBSA Complaint — LegalClarity
5. Employer's guide to COBRA initial and election notices — EBM
6. COBRA Election Notice and Form — Katten Muchin Rosenman