Employee Benefits

MHB lawyers have successfully represented employees in overturning denial of their benefits.  Benefits are an important form of compensation offered by many employers, which often include health and disability benefits (e.g., “short-term disability” and “long-term disability” plans), and even retirement (e.g., “401(k)” plans) and stock options.

Public Employment.  Washington law protects the rights of public employees to recover benefits to which they are entitled, providing a remedy for wrongful denials.

Private Employment.  If a private employer chooses to create a benefit plan, it must follow a federal law called the Employee Retirement Income Security Act (“ERISA”), which protects an employee’s rights to collect benefits.  The law is complicated, but here are some of ERISA’s rules:

  • upon request, the administrator of the benefit plan must provide employees with important facts about plan features and funding;
  • there are minimum standards for employees to participate in the benefits plan, for vesting and accruing benefits, and for funding the benefits;
  • the administrator of the benefits plan has a fiduciary duty for managing plan assets;
  • the administrator of the benefits plan must establish a claims and appeals process to obtain benefits;
  • a person may sue for being denied benefits or for other interference with recovering benefits such as being wrongfully terminated from for work, or for a breach of fiduciary duty; and
  • if an employer terminates its benefit plan payment of certain benefits may be guaranteed by a federally chartered corporation, the Pension Benefit Guaranty Corporation (PBGC).

Under ERISA, before filing a lawsuit, the employee who has been denied benefits must first submit an internal appeal with the plan administrator (often an insurance company).  Plan administrators often deny legitimate internal employee appeals, which can be successfully challenged in court.

A careful and comprehensive approach to the internal appeal process is essential so employees should seek legal advice or representation as soon as possible after their benefits are denied. The evidence that can be presented in court in a lawsuit is generally limited to the “Administrative Record”—the evidence and materials that the employee submitted to the administrator of the plan (often an insurance company) during the internal appeal process—which takes place during a limited period of time.  If the employee prevails in the lawsuit, the Court may award the denied benefits as well as attorney fees and costs.

Sources/Resources:     http://www.dol.gov/ebsa/faqs/faq_compliance_pension.html


DisclaimerThis webpage provides basic information about employee rights.  It does not offer, nor is it intended to be, legal advice.  You should consult with an attorney for advice about your individual situation.  We invite you to contact us to schedule a consultation.

MHB lawyers who practice in this area:  Jesse Wing, Joe Shaeffer, Jeffrey Taren, and Tiffany Cartwright.