Sunday, November 28, 2010

Our company is dropping health insurance on all 1099 contractors. Do we have to enroll them on COBRA?

- We're not cancelling their contracts, we're just eliminating their health insurance since BCBS informed us we needed to extend it to ALL 1099s & the overhead costs would go off the roof. - So they'll still be working for us. We're trying to find some individual insurance alternatives, but the question we want resolved to comply with the law is if COBRA needs to be offered at all.
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1099 means they're sub-contractors and not employees...you never had to offer benefits to them to begin with (what a great perk for them!) so you certainly do not have to offer them COBRA, which is for full time employees, not subs. (Basically, a 1099 means they are self-employed as far as labor laws go.)
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