Can an employer terminate benefits when an employee is on non-FMLA leave for failure to pay premiums?
The employer can absolutely condition benefits on the employees timely paying required premiums. Failure to pay premiums is not a qualifying event for COBRA purposes, so the employer should proceed carefully. If the employer allows active coverage to continue while someone is on leave and they don’t pay the premiums, the employer can cancel coverage and the employee does NOT receive COBRA. Or, the employer could say that when an employee goes on leave they have a reduction in hours and therefore lose coverage but they are offered COBRA. The employer could pay part of the COBRA premiums. When the employee returns to work, they drop COBRA and return to the active plan.