News Notes: Benefits Plan Singling Out Workers On Medical Leave Violates ERISA

When Professional Risk Management acquired Applied Risk Management, the companies’ agreement provided for all active Applied employees to automatically be transferred to Professional without a break in health benefits coverage. But workers on medical, disability or other extended leave weren’t transferred until they returned to active duty, and they consequently lost health coverage until they returned. Denise Lessard, an Applied employee who had been on workers’ comp leave for two years at the time of the transfer, sued, claiming her benefits were wrongfully terminated. The Ninth Circuit agreed, saying the plan discriminated against employees on medical or disability leave in violation of ERISA, the federal employee benefits law.