Death of Employee laws & HR compliance analysis

Death of Employee: What you need to know

Any wages or compensation owed at the time of the employee's death must be paid by the employer. Depending on state law and the size of the deceased employee's estate, employers may be required to make payment directly to a surviving spouse or dependent. Information is available about state laws that govern how and when final paychecks must be paid.
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The federal Employee Retirement Income Security Act of 1974 (ERISA) (29 USC 1002et seq.) requires that retirement, pension, defined benefit, and money-purchase plans provide survivor benefits to:
• A retired employee's surviving spouse
• The surviving spouse of an employee who continued to work after reaching the earliest possible retirement date under the plan, and then died before retiring
An election by a married employee not to provide survivor benefits to the spouse may be made only with written consent of the spouse. Plans must provide a written explanation of joint and survivor annuity (JSA) and the right to waive coverage under JSA. Additional information is available.
The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) requires employers that sponsor group health plans to offer a continuation of group health insurance, for up to 36 months, to the surviving spouse and dependents of a deceased employee. Employers must notify the surviving spouse and dependents of this right within 30 days.
Wage replacement benefits as well as burial and funeral expenses are available in every state for the surviving spouse and dependents of an employee who dies as a result of a work-related injury or illness. The amount of compensation is usually the same as for total disability.

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