Saturday, January 12, 2013

Benefits questions can trigger ERISA suit ? Business Management ...

The Employee Retirement Income Security Act (ERISA)?which regulates most employee benefits programs?makes it illegal for employers to fail to properly deposit funds with??held from employee paychecks to pay for ERISA benefits. The law also allows employees to sue if they believe they suffered retaliation for giving information or testifying in an ERISA proceeding.

Until now, employers assumed that an employee had to at least make a formal complaint to the Department of Labor (DOL) before he could sue for retaliation. That?s no longer true.

A court has ruled that just asking about what happened to paycheck withholdings can be enough notice to justify a retaliation lawsuit if the employee can connect some adverse employment action (like a demotion or discharge) to the inquiries.

Recent case: Victor, who worked for Junior Achievement as a vice president, became concerned when money withheld from his paycheck for his retirement account and health savings account didn?t show up on his statements. For five months, he complained to various supervisors. Finally, after Victor called the DOL, Junior Achievement cut him a check for the disputed amounts, plus interest.

Shortly after, Victor was discharged.

He sued, alleging retaliation for complaining internally about the money withheld from his paychecks and not being deposited into the ERISA-covered accounts.

Junior Achievement argued that only formal DOL complaints counted as inquiries that could trigger a retaliation lawsuit.

The 7th Circuit Court of Appeals disagreed. It interpreted ?inquiries? much more broadly, to include just about any question an employee might have about ERISA benefits. Victor?s lawsuit will proceed and he will have a chance to show that his persistent questions led to his termination. (George v. Junior Achievement, No. 11-3291, 7th Cir., 2012)

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