With its en banc decision in Ariana v. Humana Health Plan of Texas,1 the Fifth Circuit reconsidered the standard of review in an ERISA denial of benefits case.
Articles Discussing ERISA.
Changes to ERISA’s Disability Claims Regulations Coming April 1
New handling regulations for ERISA disability claims will go into effect on April 1, 2018, the Department of Labor (DOL) has announced. The agency confirmed that the regulations are final, without changes.
Court Rules that Company Discretionary Offer of Voluntary Separation Agreements Does Not Create an ERISA-Covered Severance Plan
It always has been difficult to give a consistent answer as to whether informal severance arrangements have created an ERISA-covered severance plan. In Mance v. Quest Diagnostics Inc., 2017 WL 684711 (DC NJ 2017), the U.S. District Court held that Quest’s decision to provide some departing employees with severance benefits under a voluntary separation agreement (“VSA”) process was provided on such a discretionary basis that it did not establish a plan under ERISA.
Supreme Court Confirms Retirement Plans of Church-Affiliated Organizations Can be Exempt from ERISA
In a much-anticipated ruling, the U.S. Supreme Court ruled on June 5 that retirement plans maintained by church-affiliated organizations can be exempt from the Employee Retirement Income Security Act (ERISA), regardless of which organization establishing the plan. While the ruling may provide some temporary relief to church-affiliated organizations, it also reveals what is likely to be the next wave of challenges in this area of the law.
Supreme Court Decision Offers Some Relief to Church-Affiliated Nonprofits Using ERISA Church Plan Exemption
Executive Summary: The U.S. Supreme Court’s decision in Advocate Health Care Network v. Stapleton serves as a reminder to church-affiliated hospitals and other organizations using the ERISA church plan exemption to review the basis for their plans’ exemptions and their plan governance structures.
Supreme Court Rules Pension Plans of Religiously Affiliated Organizations Exempt from ERISA By René E. Thorne an
ERISA’s “church plan” exemption applies to pension plans maintained by church-affiliated organizations such as healthcare facilities, even if the plans were not established by a church, the U.S. Supreme Court has ruled unanimously, 8-0. Advocate Health Care Network et al. v. Stapleton et al., Nos. 16-74; 16-86; 16-258 (June 5, 2017). (Justice Neil Gorsuch did not participate in the decision because the case was argued before he joined the Court.)
UNANIMOUS SUPREME COURT DECISION IN FAVOR OF “CHURCH PLAN” DEFENDANTS
Today, the Supreme Court handed a long-awaited victory to religiously affiliated organizations operating pension plans under ERISA’s “church plan” exemption.
SUPREME COURT HEARS “CHURCH PLAN” ERISA CLASS ACTION CASES
On Monday, the Supreme Court heard oral argument in the consolidated “church plan” cases, Advocate Health Care Network v. Stapleton, St. Peter’s Healthcare System v. Kaplan, and Dignity Health v. Rollins.
DISGORGEMENT CLAIMS CONTINUE TO CONFOUND COURTS IN ERISA CLASS ACTIONS
Courts continue to be split over the availability of disgorgement and “accounting for profits” in ERISA class actions involving in-house investment plans. On March 3, 2017, in Brotherston v. Putnam Investments, LLC, No. 1:15-cv-13825-WGY (D. Mass. March 3, 2017), the court declined to resolve the dispute at the summary judgment stage, allowing the certified class of employees to move forward with their claim that the company should be forced to disgorge profits earned from defendant’s in-house 401k plan. Previously, the court denied defendant’s motion to dismiss this claim.
The New ERISA Claims and Appeals Regulations for Disability Benefits
The Employee Benefits Security Administration of the U.S. Department of Labor recently published final regulations governing the ERISA claims and appeals process that will apply to all claims for disability benefits filed on or after January 1, 2018. These regulations add procedural safeguards to the claims and appeals process for disability benefits, and largely track the provisions of regulations proposed in 2015.
ERISA Cyber Security Threats and the Role of Human Resources
With the increasing threat to organizations from data breaches, HR plays a critical role in helping prevent and minimize the risk from cyber theft. This podcast will address how to identify potential cyber security problems, workforce challenges in data protection, and the use of policies, training and employee education that are designed to protect private and sensitive data.
DOL Rule Imposes Significant Increases in Penalties for Employee Benefit Plan Violations
On June 30, 2016, the U.S. Department of Labor (“DOL”) issued an interim final rule that significantly increases various penalties under the Employee Retirement Income Security Act of 1974 (“ERISA”). The interim rule is the result of a 2015 amendment to the Federal Civil Monetary Penalties Inflation Adjustment Act of 1990, which required federal agencies to issue an interim final rule by July 1, 2016, that adjusts civil penalties for inflation. The amendment further requires federal agencies to continue to adjust civil penalties for inflation on an annual basis.
What Does the Supreme Court’s Spokeo Decision Mean in the ERISA Litigation Context?
ERISA practitioners should be aware of the extent to which the United States Supreme Court’s decision in Spokeo, Inc. v. Robins may touch on ERISA claims and defenses. In Spokeo, decided 6 to 2 last month, the Supreme Court addressed the issue of constitutional standing under the Fair Credit Reporting Act (“FCRA”), and our FCRA litigation practice group has commented recently on the decision. However, the Spokeo decision likely will have a unique impact in the ERISA litigation context.
“Off the Rails:” A Plan Administrator’s Burden
When an ERISA plan provides the plan administrator with discretion to interpret the terms of the plan, the administrator’s claims and appeals decisions are generally reviewed by courts under a lenient standard of review such as “abuse of discretion.” In such cases, courts generally will not upset the plan administrator’s decision absent a clear error.
(Video) Collective Investment Trusts as Retirement Plan Investment Options: Important Tax and ERISA Considerations
Nexsen Pruet tax and employee benefits attorney Sue Odom says retirement plan fees and expenses have been the “hot topic” for the past several years. We’ve seen increased regulation through disclosure requirements and increased litigation.