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By: Brian M. Murray, Baker & Hostetler LLP
This article discusses aspects of Section 510 of the Employee Retirement Income Security Act (ERISA) (29 U.S.C. § 1140), which prohibits interference with benefits and retaliation for the exercise of rights under ERISA and ERISA employee benefit plans. The prohibition applies to employee pension benefit plans and employee welfare benefit plans, to vested and unvested benefits, and to actions affecting a single individual or multiple individuals. By virtue of Section 510, employees should be able to claim benefits and exercise their rights under the law without fearing their employer’s interference or reprisal.
ERISA Section 510 prohibits discrimination (including discharge, fine, suspension, expulsion, or discipline) against any ERISA employee benefit-plan participant or beneficiary, for exercising any right under the provisions of the plan. Section 510 claims lie at the intersection of many well-established and often competing policies. Since these policies are explicitly and implicitly considered by courts at all stages of litigation, you should recognize them to help litigants better frame their legal arguments.
Factors against the Robust Application of Section 510
Several factors weigh against a robust application of Section 510. Historically, the law has not required employers to sponsor employee benefit plans. Outside of the collective bargaining context, if an employer chooses to sponsor a plan, it has broad discretion to establish the plan’s terms and only marginally narrower discretion to amend those terms on a prospective basis. This is particularly true of welfare benefits because, at least prior to health care reform and with the exception of a few Internal Revenue Code limits, the law did not prescribe levels of participation or benefits.
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Brian Murray is a partner at Baker and Hostetler LLP. He has a depth of experience counseling small private companies to large publicly traded corporations on diverse employee benefit and executive compensation matters across a multitude of industries, including pharmaceuticals, food and beverage, and financial services. Brian has also been heavily involved in employee benefits matters in mergers, acquisitions, and dispositions, as well as the consolidation and restructuring of employee benefit plans and arrangements after closings. He wishes to thank Dan McClain, an associate in the Cleveland office of Baker and Hostetler, for his assistance.
For a discussion on the roles of fiduciaries of employee benefit plans under the Employee Retirement Income Security Act (ERISA), see
> FUNDAMENTALS OF ERISA FIDUCIARY DUTIES
RESEARCH PATH: Employee Benefits & Executive Compensation > Health and Welfare Plans > ERISA and Fiduciary Compliance > Practice Notes
For an overview on the preemption provision of ERISA, see
> ERISA PREEMPTION
For guidance in identifying employee benefit plans and programs that are subject to regulation under ERISA, see
> IDENTIFYING ERISA EMPLOYEE BENEFIT PLANS
For more information on the Patient Protection and Affordable Care Act (ACA) whistleblower provisions and regulatory procedures, see
> UNDERSTANDING THE WHISTLEBLOWER PROVISIONS OF THE ACA
RESEARCH PATH: Employee Benefits & Executive Compensation > Health and Welfare Plans > Health Plans and Affordable Care Act > Practice Notes
For a description on the shared responsibility rules for applicable large employers under the ACA, see
> EMPLOYER SHARED RESPONSIBILITY MANDATE UNDER THE ACA