Gabelman v. Sher: Defining a "Plan" Under ERISA

Gabelman v. Sher: Defining a "Plan" Under ERISA

What is a "plan" under ERISA? In this Analysis, Barry L. Salkin of Olshan Grundman Frome Rosenzweig & Wolosky LLP addresses this question and discusses Gabelman v. Sher, 2012 U.S. Dist. LEXIS 40334 (March 23, 2012) [enhanced version available to lexis.com subscribers], which provides a clear illustration of an arrangement that, to a lay person, or even an attorney who does not specialize in employee benefits, would appear to be a plan but which the District Court determined was not a plan. Mr. Salkin writes:

    SUMMARY: Plaintiff sued his former employer alleging that defendant's denial of retirement benefits after he was discharged violated ERISA. The United States District Court for the Eastern District of New York granted defendant's motion to dismiss the complaint on the grounds that the retirement benefits agreement between plaintiff and defendant was not an ERISA covered plan, hence there was no basis for federal subject matter jurisdiction.

    Lack of statutory definition: On occasion, although a statute defines a number of terms, the meaning of which would otherwise be opaque, it fails to define a basic term. Such is the case with ERISA. While it provides definitions for terms such as "defined benefit plan," "defined contribution/individual account plan," "employee plan," "employee pension benefit plan," "employee welfare benefit plan," "single employer plan" and "multiemployer plan," among others, it does not define "plan." Rather, that task has been left to the courts and frequently involves drawing a fine line.

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