Job Doc

COBRA still an option if you’re fired

By Patricia Hunt Sinacole
Globe Correspondent / March 7, 2010

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Q. I am an employee at will for my current employer. I was recently put on a performance improvement plan that says I need to meet certain requirements or “actions will be taken including termination of employment.’’ I am working my hardest to achieve these items, but also need to plan for contingencies. If I am indeed terminated for not meeting the requirements, am I still eligible for unemployment and COBRA benefits?

A. Most of us are employees at will. What this means is that our employer can terminate us at any time or for any reason. Additionally, an employer can change the terms and conditions of our employment for any reason, including our work hours, location, job responsibilities, or benefits.

Although it can be difficult for workers to receive, a performance improvement plan is often a helpful communication vehicle. It signals that there is a performance concern. Additionally, a well-written plan clarifies what requirements need to be met for continued employment. I am pleased to hear that you are working your hardest to meet the expectations outlined in your plan.

However, I agree that a contingency plan is prudent. Most employers are required to offer COBRA, which allows former employees to have continuing health care coverage, for eligible workers and their dependents.

COBRA only applies to companies that have 20 or more employees. Some states, including Massachusetts, require smaller employers (those with two to 19 employees) to offer “MiniCOBRA.’’

Health care coverage rates are generally more expensive for COBRA participants than the rates offered to active employees. In part, this is because the employer often pays part of the monthly premium for active employees and their dependents. COBRA participants are often charged the entire premium plus a small administrative fee. Even though COBRA rates can be expensive, they are often less expensive than individual coverage premiums.

For an employee to be eligible for benefits through COBRA, one of the following events typically occurs:

1. Voluntary or involuntary termination of employment for reasons other than gross misconduct.

2. Reduction in the number of hours of employment.

In general, if you are terminated for not meeting a performance goal (and there is no gross misconduct), you should be eligible for benefits through COBRA. You would be eligible for the benefits that you had before your termination. For example, if you had individual coverage for medical and dental, you should be offered individual medical and dental coverage through COBRA.

If you are terminated, you may be eligible for a reduced COBRA rate (or subsidy) under the American Recovery and Investment Act of 2009. Currently, the subsidy is only available to workers who were involuntary terminated from their jobs between Sept. 1, 2008, and Feb. 28, 2010.

The US Department of Labor provides a lot of information on COBRA at

In Massachusetts, unemployment benefits are available to workers who are unemployed through no fault of their own. Recipients must be available to work, willing to work, and looking for a new job. Unemployment is temporary income protection for those residents who have lost a job.

Most individuals who are terminated for performance reasons are eligible for unemployment benefits. However, if your former employer is able to demonstrate that you were terminated because of misconduct or a violation of a company policy, you may be disqualified. Visit for more information about unemployment benefits in the state.

Patricia Hunt Sinacole is president of First Beacon Group LLC (, a human resources consulting firm in Hopkinton.