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Supreme Court remands ERISA case
November 27, 2006 by Ross Runkel at LawMemo
Metropolitan Life Ins Co v. Hawkins-Dean (US Supreme Court 11/27/2006) | Order
Case below: Hawkins-Dean v. Metropolitan Life Ins Co (9th Cir 01/06/2006)
Hawkins-Dean sued an ERISA plan administrator seeking long-term disability payments under her employer's group insurance policy. The administrator first denied eligibility and then admitted eligibility for benefits, and calculated that at 60 percent of Hawkins-Dean's earnings - excluding stock options. The trial court held that the administrator had discretion under the plan and did not abuse its discretion in calculating benefits.
The 9th Circuit reversed. First, the 9th Circuit said that the administrator had discretion under the plan. Then the 9th Circuit said that the district court should have reviewed the benefits amount using a de novo standard. The court said, "MetLife's denial and subsequent concession of eligibility for disability benefits was material, probative evidence tending to show that MetLife's decision regarding the amount of benefits due to Hawkins-Dean was affected by self-interest."
The administrator petitioned the US Supreme Court for certiorari in May 2006. Later, the 9th Circuit decided Abatie v. Alta Health and Life Insurance, 458 F.3d 955 (9th Cir en banc 08/15/2006). Abatie signaled a totally different approach to ERISA cases in which a plan administrator denies benefits and (1) the wording of the plan confers discretion on the plan administrator; and (2) the plan administrator has a conflict of interest.
The US Supreme Court vacated the 9th Circuit's judgment in Metropolitan Life Ins Co v. Hawkins-Dean and remanded for further consideration in light of Abatie.
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Paycheck discrimination and the Supreme Court
November 27, 2006 by Ross Runkel at LawMemo
Ledbetter v. Goodyear Tire & Rubber Co is being argued at the US Supreme Court today. [Details, briefs]
Lilly Ledbetter retired after 19 years at the Goodyear company. Then she claimed her employer paid her a smaller salary than it paid male co-workers because of her sex. Her periodic paychecks were based on annual salary reviews.
A jury awarded damages to Ledbetter based on a series of salary decisions going back 19 years.
The 11th Circuit reversed and ordered that Ledbetter's complaint be dismissed.
The problem was with the statute of limitations, which requires an employee to file an EEOC charge within 180 days after an alleged Title VII violation "occurred."
The 11th Circuit held that her claim was time barred because she could not prove intentional discrimination in either (1) the one decision during the limitations period or (2) the last decision preceding the limitation period.
The 11th Circuit said: "We conclude that in the search for an improperly motivated, affirmative decision directly affecting an employee's pay, the employee may reach outside the limitations period created by her EEOC charge no further than the last such decision immediately preceding the start of the limitations period. We do not hold that an employee may reach back even that far; what we hold is that she may reach no further."
My view: It's hard to see how Ledbetter can win this one.
The case really turns on when a violation occurs. Typically this is when the employer has made a decision and then acted on that decision. Once a violation occurs, then the employee has 180 days to file.
I think there are three logical choices for how the Title VII statute of limitations works in the case of paychecks:
- A violation occurs when the employer makes a decision, and if the employee does not file a charge within 180 days of the decision then no future claim can be based on that decision. That's Goodyear's view.
- A violation occurs with each paycheck, and the employee can claim that the amount of each paycheck was based on discriminatory decisions made years ago. That's Ledbetter's view.
- A violation occurs when the employer makes a decision and the decision is communicated to the employee, typically by way of the next paycheck. This is the view advanced by the United States in its amicus brief.
#3 is the way the statute of limitations works in cases involving discharge, failure to hire, failure to promote. I think it works the same way here. Ledbetter says there should be a different approach for paychecks. If so, the statute needs to be reworded.
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NLRB Case production report
November 09, 2006 by Ross Runkel at LawMemo
Here is the NLRB press release dated November 6, 2006:
NLRB REPORTS ON CASE PRODUCTION IN FY 2006
The National Labor Relations Board issued 477 decisions during fiscal year 2006, which ended September 30. Of this total, 324 were unfair labor practice (C) cases, and 153 were representation (R) cases. In the previous fiscal year, the Board issued 508 decisions (348 C, 160 R).
While production declined by 6% since FY 2005, the inventory of pending cases was reduced for the fourth year in a row (from 484 at the beginning of the fiscal year to 305 at the end).
In a statement, Chairman Robert J. Battista remarked:
We regret the drop in case production, but we issued some difficult decisions in FY 2006, and that had an adverse impact on our overall production. We are hopeful, with a full Board for all of FY 2007, we will see improved productivity. On the positive side, we were able to keep lowering our case backlog. We would like to take this opportunity to thank our staffs for their hard work and dedication to the mission of the agency.
The Board did not fully accomplish its FY 2006 goal under the Government Performance and Results Act (GPRA). The Board’s performance goal was to issue 90% of C cases that, if not issued by September 30, 2006, would then have been pending for more than 17 months; and 90% of R cases, that if not issued by September 30, 2006, would then have been pending for more than 12 months. In other words, C cases assigned on or before April 30, 2005 and R cases assigned on or before September 30, 2005. The Board began FY 2006 with 295 GPRA C cases and 129 GPRA R cases. The Board issued 137 GPRA C cases (46%) and 100 GPRA R cases (77%) by the end of FY 2006.
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Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.
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