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Friday, August 15, 2008

EIRSA’s Reach Shortened by the US Supreme Court

The US Supreme Court denied certification in Silverleaf v Resorts, Inc. v. McAteer, 128 S.Ct. 2884, and allowed to stand a 5th Circuit decision, McAteer v. Silverleaf Resorts, Inc., 514 F.3d 411 (C.A.5-Tex. 2008) ,that held that an employee’s state law negligence claim against her employer for the failure to maintain a safe workplace were not preempted by the Employee Retirement Income Security Act (ERISA]. The employee’s action was improperly removed on theory based on ERISA preemption. The employee was required to waive participation in the State of Texas’ workers compensation program in order to participate in the employer’s EIRSA plan. The election made ERISA the exclusive remedy for any on-the-job-injuries.

In the decision rendered by the 5th Circuit, the Court held that RISA does not preempt state law negligence claims relying upon its prior decision in Hook v. Morrison Milling Co., 38 F.3d 776 (C.A.5-Tex. 1994).

The employer, Silverleaf, was a non-subscriber to the Texas workers’ compensation plan and had stabled an ERISA governed plan to provide benefits to employee in the event of a job-related injury and provide for the arbitration of disputes regarding benefits.

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