WHEN YOU TERMINATE AN EMPLOYEE - PART 2

Recalling yesterday's post about New York Labor Law Section 195 (6) requiring written notice of termination, etc., it also provided that "Failure to notify an employee of cancellation of accident or health insurance subjects an employer to an additional penalty pursuant to section two hundred seventeen of this chapter." Let us look at that penalty.

New York Labor Law Section 217 (7):

"(a) Any policyholder who fails to comply with this section, shall forfeit to the people of the State a sum up to five thousand dollars, to be recovered by the commissioner in a civil action.  Where the policyholder is a corporation, trade association, joint stock association, incorporated or unincorporated association, the president, secretary and treasurer thereof shall be liable for any forfeiture.

(b) In addition to such penalty, where the failure to comply involves the failure to notify an employee of the termination of a group accident or group health policy pursuant to subdivision three of this section or the failure to remit premiums pursuant to subdivision six of this section, or the failure to provide an individual with notice of termination pursuant to subdivision six of section one hundred ninety-five of this chapter, the policy holder shall also be liable, in a civil action brought by the individual entitled to receive the notice of termination or exercise the right to continuation of coverage in a court of competent jurisdiction, to appropriate damages which shall include reimbursement for medical expenses which were not covered by the policyholder's insurer by virtue of his termination of the policy or failure to remit such premiums."

And this is in addition to the penalties under New York Labor Law Section 218 (1) which state, in effect, that an employer who violates the non-monetary provisions of Article 6 of the Labor Law (which includes Section 195), is subject to a maximum penalty of $1,000 for a first violation, $2,000 for a second violation and $3,000 for a third or subsequent violation.