When does ERISA apply to a short term disability insurance plan?
A case heard before the U.S. District Court’s Southern District in Texas gives us an opportunity to study ERISA pre-emption. George Monkhouse originally filed his suit against his employer, Stanley Associates Inc. (Stanley) in the 506th Judicial District Court of Grimes County, Texas. He claimed that Stanley had failed to provide the disability benefits promised in its short-term disability income plan. The plan administrator of the short term disability plan was Cigna. Stanley had the case removed to the U.S. District Court, claiming that the Employee Retirement Income Security Act (ERISA) pre-empted any state based claim Monkhouse had against the Stanley short-term disability plan. Monkhouse’s short-term disability attorney argued otherwise. He claimed that the Stanley STD plan was not an employee welfare benefit plan, but rather it was an exempt payroll practice that fell under the jurisdiction of the Department of Labor (DOL). He moved that the Court remand the suit back to the sta
