A case recently decided by the Eighth Circuit Court of Appeals should serve as a warning to employers that they may be bound by their erroneous statements regarding an employee’s eligibility for a leave of absence under the Family Medical Leave Act (“FMLA”). In Reed v. Lear Corp., No. 08-1498 (8th Cir. 2009), the court stated that employers can be bound by statements they make regarding an employee’s eligibility for leave under the FMLA. While the court ultimately decided that the employee’s reliance was not reasonable in this case, the case nonetheless provides useful guidance to employers.
Eighth Circuit Court of Appeals Upholds Arbitration Agreement Even Where Some Provisions of the Agreement are Unlawful
By Carrie L. Zochert
The Eighth Circuit Court of Appeals enforced an arbitration agreement despite the presence of two arguably unlawful provisions, because the parties could properly sever the invalid terms pursuant to a severability clause in the agreement. In Franke v. Poly-America Medical & Dental Benefits Plan, an ERISA plan participant, James G. Franke, filed suit in Minnesota federal district court against the plan after a plan administrator denied compensation of his medical bills. Franke, __ F.3d __, 2009 WL 260519, at *1 (8th Cir. 2009).
ERISA Plan Administrators Must Follow Participant’s Beneficiary Designation
By Carrie L. Zochert and Britta L. Orr*
In an unanimous opinion, the United States Supreme Court recently ruled that an ERISA plan administrator must follow a deceased participant’s beneficiary designation even where the beneficiary (in this case the decedent’s former spouse) validly waived her rights to an ERISA savings and investment plan under federal common law pursuant to a divorce decree years earlier. Kennedy v. Plan Adm’r for DuPont Savings & Inv. Plan (U.S. 2009). The decision has attracted significant attention from employment and family law communities because of its potential impact on 300,000 to 400,000 divorcing workers each year and their heirs, beneficiaries, and families.
By Mary L. Komornicka
The economic stimulus bill, the American Recovery and Reinvestment Act (“ARRA”), includes health coverage assistance for employees laid off due to the current economic recession. Effective immediately, the federal government will subsidize up to 65% of the an employee’s premium cost under a COBRA health plan continuation.
Update on E-Verify
By Chris M. Heffelbower
E-Verify is an internet system that allows employers to electronically verify the employment eligibility of their newly hired employees. The use of E-Verify is voluntary for most employers, however, it will be mandatory for certain federal contractors. We informed you of the details of E-Verify in our September Newsletter. Recently, there have been updates to the E-Verify requirements:
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The Larkin Hoffman employment law team identifies and resolves workplace issues in this rapidly evolving and highly regulated area. Our attorneys provide counsel and advice to employers. We represent employers in state and federal courts and administrative agencies including the EEOC, MHRA, NLRB, OSHA and DOL.