Benefit Plan Complaint – “Sue or Tell?”

Question: I have a potential lawsuit basis against my employer based on discretionary exclusion from a benefits plan that I could successfully argue falls under the purview of ERISA. I feel torn between bringing this issue to light with management (i.e., showing my cards) versus letting them know about it at first through a summons, which could be devastating for me as well (i.e., termination, etc.). Thoughts?

Jim, Ohio

Answer: The anwer to your question requires just four words: “exhaustion of administrative remedies.”

Simply put, the federal ERISA law (actually, the Employee Retirement and Income Security Act) you refer to contains a general provision that applies to almost all disputes arising under that law: before you can come into Court, you must first “exhaust all of your administrative remedies.” If you have not done that, your case in Court will likely be thrown out.

What are these “administrative remedies?” Almost every Benefit Plan provides that, if you have a dispute about it, you must file a “Request for Review” (or words to that effect) to the Plan Administrator within a certain period of time, often 90 or 180 days. The Plan Administrator then has a period of time, often 120 days, to respond. Then, if you are not satisfied with the response, or lack of response, you have to file a “Request for Appeal” (or words to that effect) and give the Plan Administrator or Appeal Board another opportunity to review your Appeal, often 90 or 120 days.

Sound frustrating, time consuming and exhausting? It is, and it makes “surprising” your employer impossible. Many attorneys shy away from ERISA claims in good part for these reasons. Fortunately, ERISA has provisions making retaliation for filing a claim a violation of law.

As I almost always do, I suggest you try to resolve the matter amicably, but in writing; with respect, but without fear. If that doesn’t work, you need to carefully review the Benefit Plan, being very careful as to deadlines, and consider consulting with an attorney experienced in ERISA matters.

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Best, Al Sklover