Arbitration Clauses in Welfare Benefit Plans Upheld. The Ninth Circuit has upheld the use of an arbitration clause in a welfare benefit plan as a means of cutting off litigation. Although this decision does not necessarily apply in Florida, the decision is helpful to employers. It is now the law in the far West, which may be of help to those with West Coast employees. Presumably similar clauses can be used in tax-qualified plans. Chappel v. Laboratory Corporation of America.
Stock Option Plans are Not ERISA Plans. Stock option plans are generally not covered by ERISA. This is because they generally provide for short term bonuses as opposed to retirement income. This is a mixed blessing for employers. On one hand the compliance burden is reduced, on the other hand, the employer loses some significant litigation advantages. Kaelin v. Tenneco, Inc.
New DOL Regulations on SPD's. On November 20 the Department of Labor issued new regulations regarding the items that must be disclosed in Summary Plan Descriptions. Although they will eventually affect most employee benefit plans, these regulations are largely effective in 2002. Some provisions are, however, effective sooner. 65 FR 70226.
Retaliation Basics. Employers who do not discriminate against an employee can be held liable if they retaliate against an employee who files a complaint with the EEOC or other agency. The merit of the retaliation claim does not depend on the strength of the underlying claim of discrimination.