Employers can’t terminate employees just because a sick dependent increases health insurance costs for the employer. That violates the Employee Retirement Income Security Act (ERISA). But if the employee is terminated for unrelated gross misconduct, he has no ERISA or COBRA claim. (COBRA is the law that allows terminated workers to continue participating in their former employer’s health insurance plan.)
Recent case: Michael worked for a body shop and had family health insurance coverage through his employer. Michael’s child has cerebral palsy, requiring daily physical therapy and medication, both of which the health plan covered.
Michael got into a screaming match with another employee, allegedly making threatening gestures, calling her a “fat-a** bitch” and shouting, “Shut up, fat bitch!” The body shop’s outside HR consultant conducted an investigation, spoke with two witnesses who described the incident very similarly and concluded Michael should be terminated.
Michael sued, alleging he had been fired because his son had high medical expenses and that he never got his required COBRA insurance continuation letter.
He pointed to several comments made after his son was born that implied covering Michael’s family was costing the shop lots of money.
The body shop argued that it never tolerated the kind of behavior Michael displayed, no matter who the employee was.
The court dismissed Michael’s case, ruling he was fired for gross misconduct, not because his son was ill. (Berry, et al., v. Frank’s Auto Body, et al., No. 11-4150, 6th Cir., 2012)
Final note: The court also pointed out that the company conducted an independent investigation before terminating Michael. Plus, it was clear that no one else had behaved as badly without being fired.
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