The Employee Retirement Income Security Act (“ERISA”), found at 29 U.S.C. §1001, et seq., was originally passed by Congress in 1974. Despite its name, it is, at best, only cold comfort for the employee who has a claim for any employer-provided benefits governed by the statute. By its terms, the right to a jury trial is eliminated and, as a result of judicial interpretations of its terms, the situation only gets worse. This is not intended as an adverse commentary on the judiciary. The judiciary is only doing its job in interpreting a statute which is slanted heavily (and unreasonably) in favor of the employers and insurance companies who render the initial benefits determination with which an aggrieved employee may disagree.
The starting point in any discussion concerning the case law interpreting ERISA is the Supreme Court case of Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948 (1989). This is the case most often cited for the proposition concerning the manner in which claims for ERISA benefits are reviewed by Courts. The starting point is that the Court’s review is “de novo” unless the Plan Documents governing the benefit entitlement provide an express grant of discretionary authority. If that grant of authority is provided the party charged with rendering the benefits determination, then concepts of Trust law will be applied to give “deference” to the benefits determination made. In the Firestone case, the employer could not rely upon application of trust law to the ERISA actions because its plan had no discretionary language. From this point, case law has blossomed over varying issues concerning what language grants discretionary authority, the procedure to be followed by the Court in rendering its decision and the impact of the conflict of interest inherent in the situation in which the party charged with rendering the benefits determination is also the purse holder, i.e., it is paying benefits out of its own money. On the subject of the conflict of interest, it is rather unusual (I will refrain from saying “silly” or “absurd”) to think about the proposition of putting an insurance company in the posture of a trustee in connection with benefit determination which it will have to pay. Apparently, Congress did not think so but I will have more on that subject later.
Please keep in mind that the foregoing is not intended as legal advice applicable to any individual person’s unique legal situation. Its sole purpose is to give a general idea of the existing status of the law as it applies to the point of law addressed above. You cannot rely on the foregoing as legal advice. You cannot make legal decisions based on its contents. If you have questions arising out of this point of law, you should contact an attorney who routinely handles claims involving policies of disability insurance. The law offices of Herbert M. Hill, P.A. handles such cases and would welcome the opportunity to discuss your case with you, at no charge. You can contact me at 407-839-0005 or at email@example.com.
If you would like, after discussing your case, we can set a conference. That conference would be free of charge and you would be under no obligation to hire me nor would you feel any pressure from me to do so.
Herbert M. Hill, P.A. is a law firm located in Orlando, Florida with a practice extending throughout the state of Florida and the southeastern part of the United States. Areas of practice include disability and employee benefit claims of all sorts. The firm handles any claims arising under the Employee Retirement Income Security Act (known and referred to as “ERISA”) for disability benefits, medical benefits, retirement benefits of any sort, including pension, 401k, termination agreements or the like as well as claims arising under private disability policies.