The Employee Retirement Income Security Act (ERISA), which governs, makes it illegal to “discharge, fine, suspend, expel or discriminate against any person because he was given information or has testified or is about to testify in any inquiry or proceeding” having to do with ERISA-covered benefits.
Recently, the 3rd Circuit Court of Appeals had a chance to declare that an informal internal complaint might be enough to protect an employee from retaliation. Fortunately for employers, it declined to do so.
Recent case: A.H. Cornell & Son hired Shirley Edwards as the company’s HR director. Her first task: setting up the company’s HR office from scratch. She worked there for about three years.
During her final weeks, she began complaining to the owners about what she thought were illegal acts under ERISA. For example, she claimed the company provided false Social Security numbers to enroll noncitizens inand discouraged other employees from signing up for health insurance by telling them premium costs would be higher than they actually were.
Shortly after Edwards complained, the company owner fired her. She sued, alleging ERISA retaliation.
After noting that federal courts have split on the question of whether internal complaints like Edwards’ are protected, the 3rd Circuit concluded they are not. The court said the law’s language suggests internal complaints aren’t covered—just participation in external investigations and the like. It dismissed Edwards’ case. (Edwards v. A.H. Cornell, et al., No. 09-3198, 3rd Cir., 2010)
Final note: Since the federal appeals courts can’t agree on this issue, and since the DOL disagrees with the 3rd Circuit’s interpretation, this case may go to the Supreme Court.
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