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In the waning days of 2007, with the cost of health care continually escalating and with more and more of the costs being borne by the United States Government, Congress passed and President Bush signed into law the Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA). With the stroke of his pen, the President created a responsibility for self insured organizations, liability insurers, group health plans and non-group health plans that pay bodily injury claims to insure that the Medicare system is protected from bearing the costs of current and future medical expenses if those expenses are the primary responsibility of an entity other than Medicare. Entities making such payments are known as RREs. In order to fulfill their responsibility, for each recipient of payments, RREs are required to make a determination as to whether the individual is a Medicare recipient and report any and all payments to the Center for Medicare and Medicaid Services (the CMS) for a determination of the subrogation rights as of that date. In order to ensure that there is an accurate determination of the subrogation rights, it will be imperative that all RREs obtain a social security number of the payment recipient and use that social security number in its reporting. Read the full article.

The Labor and Employment Practice Group of Williams Kastner has seen a sharp increase in trust fund litigation against union signatory employers, and also a refusal by trust funds to pay benefits on behalf of participating owners under so-called Associate Agreements. Employers involved in litigation with union trust funds often learn that trust documents and collective bargaining agreements are construed in favor of the trust funds. That's why the recent decision of Brown v. Southern California IBEW-NECA is of interest. Read the full article.

On January 6, 2010, the U.S. Equal Employment Opportunity Commission (EEOC) announced its results for Fiscal Year (FY) 2009. See http://www.eeoc.gov/eeoc/statistics/enforcement/index.cfm.

The EEOC announced that 93,277 charges of workplace discrimination were filed in FY 2009. This is the second highest number ever. It also announced that it obtained over $376 million in monetary relief for charging parties and others in FYI 2009, of which $294 million was obtained through administrative enforcement and mediation. Read the full article.

As has been underscored at recent Williams Kastner Labor and Employment Practice Group seminars and in articles, the economic downturn has led to an explosion of wage and hour actions by plaintiffs' attorneys. Here are some recent developments in the wage and hour area.

Independent Contractor Status. The primary focus of litigation has been alleged misclassification of independent contractors. Federal agencies and even state legislatures have taken action to correct alleged abuses in this area. All are watching the effort by the International Brotherhood of Teamsters to organize Federal Express ground drivers by attacking their independent contractor status. In early 2009, the Northern District of Indiana granted a class action status to current and former drivers in eight states, while class certification was denied in four other states. In March 2009, a Washington Superior Court jury determined that a class of Federal Express ground delivery drivers were independent contractors and therefore were not due overtime. These decisions have led to interest in both federal and state legislation in this area since the independent contractor status is seen as a major hindrance to union organizing, and also a significant loss to state coffers relying on workers compensation and unemployment compensation premiums from employers. Read the full article.

In 2009, the United States Supreme Court reemphasized that an ERISA plan's documents control, even in the face of clear evidence of the plan participant's intentions to the contrary. See Kennedy v. Plan Administrators for DuPont Savings and Investment Plan.

In Kennedy, the plan participant died in 2001, leaving pension benefits of $400,000 in the DuPont plan. In 1974, while he was married the participant had designated his wife as his beneficiary on this ERISA plan. They divorced in 1994 subject to a decree which provided that the ex-wife was "divested of all right, title, interest and claim in and to...the proceeds [from]...[any] retirement plan, pension plan, or like benefit or program." This document, however, did not satisfy the requirements of a qualified domestic relations order (QDRO). The participant never changed the beneficiary designation on his retirement account, presumably relying on his ex-wife's divestment of all rights to or benefits from his retirement. Read the full article.

Followers of labor and employment law have seen some epic corporate campaigns between large national employers and unions. In the wage and hour arena, union efforts to organize industry giant Wal-Mart have included wage and hour class actions, as well as proposals for health care legislation in various states. A similar battle has been brewing between UNITE HERE and Cintas Corporation. Read the full article.

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Williams, Kastner & Gibbs PLLC - 2010