Benefits available to workers after termination

After a worker is terminated in Zenefits, in most cases, the worker's benefits coverage will extend to the end of the month in which they were terminated. Some companies may have same-day or mid-month termination policies.

Upon termination, two types of insurance become available to terminated workers.

  • COBRA (Continuation of Health Coverage), which continues to provide health insurance to the terminated worker.
  • Unemployment Insurance (UI), which provides temporary financial assistance to the worker while they look for work. UI benefits are based on the worker's previous wages/salary and the duration of previous employment.

COBRA and Unemployment Insurance (UI) are not the same. COBRA is a continuation of employer health coverage while unemployment insurance are benefits paid by the state to eligible unemployed individuals. Zenefits does not administer UI.

When a worker who was enrolled in coverage is terminated, they may be eligible for Federal or State COBRA, which is an extension of their current benefits for a certain amount of time. Federal COBRA lasts up to 18 months, while State Continuation varies from state to state. A worker can elect to enroll in and pay the whole cost for medical, dental, and vision policies that they were enrolled in at the time of termination. State COBRA, however, may allow continuation for only medical insurance policies. 

For life and disability insurance, some carriers allow for group policies to be switched to individual policies. Contact your broker for more information.

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