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Court Rules Workplace Safety Laws Independent of ERISA

January 24, 2008
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Related Topics: Miscellaneous Legal Issues, Retirement/Pensions, Workforce Planning, Latest News
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The 5th U.S. Circuit Court of Appeals has ruled that the Employee Retirement Income Security Act does not pre-empt state law claims regarding unsafe workplaces.

Le Ann McAteer, a former employee for Silverleaf Resorts Inc., worked as a landscaper at the Holly Lake Ranch in Texas, about 100 miles east of Dallas. Silverleaf, which is based in Dallas, does not subscribe to Texas workers’ compensation insurance, but does provide benefits to its employees through the Silverleaf Club Employee Injury Benefit Plan, which is governed by ERISA.

The plan provides no-fault benefits to employees in the event of a job-related injury and requires arbitration of any disputes regarding its benefits.

According to court documents, McAteer claimed she suffered a job-related injury when she tripped over a cement parking block while using a string weed trimmer in July 2005. She fell on her back and was later diagnosed with a herniated disc that required surgery.

McAteer did not report the injury to Silverleaf and left the company in August 2005. She notified Silverleaf of the injury in September 2005.

McAteer’s claim was denied by Silverleaf because she did not report it in a timely manner, did not she seek advance approval for her medical treatment and did not use a plan-approved physician, according to court documents.

In January 2006, she filed a lawsuit against Silverleaf in the U.S. District Court for the Eastern District of Texas, alleging that Silverleaf was negligent by failing to provide her with a safe place to work when it assigned her to work in a parking lot when the company knew parking stops were hazardous; failing to warn her of the potential hazards; and failing to inform her of employee safety measures to help prevent the accident.

The district court ruled that ERISA barred her injury claims and dismissed her case.

U.S. Circuit Judge Edward C. Prado’s ruled on January 15 that in similar cases previously, state law negligence claims for failing to maintain a safe workplace are independent of ERISA.

In his opinion, Judge Prado said that McAteer’s claim under state law was preserved even though she added an ERISA claim to her action after it was dismissed by the district court. Prado ruled that McAteer’s “state law negligence claims in this case are not pre-empted by ERISA and must be remanded,” and that “she did not make her argument moot by adding an ERISA claim,” thus reversing and remanding the district court decision.

Filed by Jeff Casale of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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