By Joe Vincoli
When the Employee Retirement Income Security Act (ERISA) was passed in 1974 it anticipated the need to protect the most valuable source of information the public had related to potential wrongdoings being committed at the innumerable employer’s health and retirement plans around the country.
That source is almost always an employee of the company who is aware of some shady or questionable transaction.
To protect this source, ERISA included this language in Section 510:
It shall be unlawful for any person to discharge, fine, suspend, expel, or discriminate against any person because he has given information or has testified or is about to testify in any inquiry or proceeding relating to this chapter or the Welfare and Pension Plans Disclosure Act.
As previously detailed in this posting 9g8clgn, the 2nd, 3rd, and 4th Federal Circuit Courts have interpreted this language more narrowly than have the other Circuits. The 2nd, 3rd, and 4th have come to the conclusion (in varying degrees) that any ‘internal’ report filed by an employee to his/her company does not merit Section 510 protection from retaliatory discharge because the employee who files an internal report has not ‘testified or is about to testify in any inquiry or proceeding…’
Most recently the Supreme Court declined to hear Edwards vs AH Connelly which specifically addressed this issue.
As such, until ERISA is amended, the ‘law of the land’ is that in the 2nd, 3rd, and 4th Federal Circuits ERISA whistleblowers do not receive Section 510 protection but in all the other Circuits employees do receive protection.
Sound fair to you?
Let me ask the question another way…do you know in which Federal Circuit you live?
You should because it may well be that your job depends on it.
I recently met with my federal representatives to discuss this issue. Here is what they said:
Senator Richard Burr R-NC :
“As you know, this has been a complicated legal dispute with an unresolved split in the circuit courts. I recognize the difficulty this can present in terms of compliance and for the navigation of various legal jurisdictions by affected individuals. I certainly do have an open mind to legislation that would promote greater legal compliance with ERISA with an eye on protecting plan participants. To my mind, the difficulty facing the courts would suggest a broader, more comprehensive review by Congress would be needed before legislating. Please know that I will keep your comments in mind as Congress considers issues regarding ERISA. Your observations and personal perspective are helpful with our continued oversight in this area.’
Representative Virginia Foxx:
As you know from our previous correspondence on this issue, my staff has reviewed some of the pending proposals to amend ERISA but it appears that none would address your concerns. However, as I am not an expert on this issue, I am not prepared to introduce legislation that would address the protection of internal reporting. Rest assured I will keep your thoughts in mind should any relevant legislation come before the House for consideration.
If you need more information or have additional concerns, please don’t hesitate to contact me. Thank you for visiting my award winning website, www.foxx.house.gov. We update our site daily and it is a great resource to learn about constituent services, legislative updates and my work in Congress. I hope you will utilize the website and let me know what you think about it.
Senator Kay Hagan:
I met with Senator Hagan’s staff last week. The staffer’s primary question? ‘Do you have any data as to how many people are affected by this?’
Think of that for a moment.
The law sets a trap for the unwitting ‘do-gooders’ in the 2nd, 3rd, and 4th Federal Circuits…people who have volunteered to serve as fiduciaries for their employer’s health or retirement plan. It requires them, as a responsibility recognized as the ‘highest known to law’, to report potential wrongdoings…but in turn, if they happen to live in the 2nd, 3rd, or 4th Federal Circuit, and if they unwittingly report the issue that they are compelled to report, the law allows them to be fired for alerting their employer to an issue.
Imagine the plight of ‘Elizabeth’… the single-parent who works in her company’s HR department.
After ten years with the firm she is asked to serve as a fiduciary. She is honored. She tells her kids about the ‘honor’ and sense of responsibility to ‘do the right thing’.
Then, external legal counsel informs her that there’s a problem…or a potential problem with the Plan, and Elizabeth reports the issue to her company’s Board of Directors.
She then finds herself out of work, without health insurance, and filing for unemployment.
She then learns that she lives in the 2nd…or the 3rd…or the 4th.
And, after 40 years of letting this happen to these trusting ‘do-gooders’…
Senator Burr says to Elizabeth…hang in there, Elizabeth, because in my mind I did not need to act to protect you from this trap, ‘to my mind’ it seemed that a ’broader, more comprehensive review by Congress would be needed before legislating.’
So, there, Elizabeth, feel my sense of compassion as a public servant.
And, Representative Virginia Foxx tells Elizabeth:
‘… as I am not an expert on this issue, I am not prepared to introduce legislation that would address the protection of internal reporting. Rest assured I will keep your thoughts in mind should any relevant legislation come before the House for consideration.
So, hang in there Elizabeth, as you max out your credit cards and file for temporary jobs without benefits… benefits you used to have but that you have now lost because the federal law required you to act to protect your fellow employees’ benefits.
And Senator Hagan’s staff asks…
‘How many “Elizabeths” are there out there over the last 40 years?”
And I ask, ‘How many “Elizabeths” will it take to amend this law?
What does the body count need to be to convince our ‘public servants’ to pass a simple amendment to a 40 year old law?
Evidently, they need more.
‘To my mind’ each of these public servants should instead have said:
‘It is imperative that the public’s interests be protected and protecting citizens who follow the law as we have written it is of highest concern. I will gladly expend whatever political capital it takes to step into the breach and right this wrong. ‘
Given the recent Supreme Court decision on Edwards vs AH Connelly, the time is NOW.