Supreme Court Issues Ruling In U.S. Airways ERISA

The United States Supreme Court held today in U.S. Airways, Inc. v. McCutchen, in a 5-4 decision, that the terms of an ERISA plan cannot be overridden by equitable principles in an action for equitable relief under ERISA Section 502(a)(3). In an opinion authored by Justice Elena Kagan, the Supreme Court vacated and remanded a decision by the U.S. Court of Appeals for the Third Circuit declining to enforce a health plan provision (that required participants to reimburse the plan for amounts received in third-party recoveries) against a participant who was not made whole by a third-party settlement. The majority also ruled that, while equitable principles cannot trump a reimbursement provision, they may aid in properly construing it. Because the U.S. Airways plan was silent as to the allocation of attorneys' fees, the Supreme Court found that the equitable "common fund" doctrine provided the appropriate default rule to fill that gap. In a short dissenting opinion, Justice Antonin Scalia disagreed with the majority's use of the common fund doctrine to fill a gap in plan language. Chief Justice Roberts and Justices Thomas and Alito joined the dissent. We will provide a more in-depth analysis of this decision in the near future. The Court's decision can be found at the link below:

http://www.supremecourt.gov/opinions/12pdf/11-1285_i4dk.pdf

New Form I-9 Issued by U.S. Citizenship and Immigration Services

A revised Employment Eligibility Verification Form I-9 has been published by the U.S. Citizenship and Immigration Services ("USCIS").  Employers are allowed to immediately begin to use the form, but beginning on May 7, 2013, employers must use the new form. Until then, the government has provided employers with a grace period during which they may continue to use the old form or may switch to the new form, at their option. If employers fail to use the new form after May 7, 2013, it may result in fines. The new form is two pages and includes additional information to be provided by employees. In particular, the new form requests the employee's telephone number, email address, and foreign passport number. For their part, employers are still required to provide the same information as required under the old Form I-9. USCIS also has released a new Handbook for Employers, known as the M-274, which provides additional guidance on completing the new Form I-9. The new Form I-9 must be completed for all new hires as well as for re-verifying current employees with expiring employment authorization documentation beginning May 7, 2013. It is not necessary to complete a new Form I-9 for existing employees who do not require re-verification.