ERISA Class Actions After Epic Systems: Challenges and Potential Opportunities for Plan Sponsors

Description

In Epic Systems Corp. v. Lewis, the U.S. Supreme Court ruled that a class action waiver in an employee’s arbitration agreement is enforceable and does not violate the National Labor Relations Act. ERISA counsel must be knowledgeable of the ramifications and potential opportunities the Supreme Court’s decision has on benefits claims, fiduciary breaches, class actions, and the terms and provisions of retirement plans.

Participants of ERISA plans can pursue a claim for plan benefits under §1132(a)(1)(B), breach of fiduciary duty under §1132(a)(2), and a claim for injunctive or other appropriate equitable relief to enforce the terms of the plan or ERISA or to remedy violations of a plan or ERISAunder §1132(a)(3). In accord with the SCOTUS decision in Epic Systems, some or all of these claims may now be subject to waiver or arbitration if appropriate provisions are included in the plan.

The SCOTUS decision made it clear that certain individual claims can be subject to arbitration agreements or class action waivers. The holding may also apply to ERISA plan participant claims for plan benefits and possibly to fiduciary breach claims arising under ERISA, even where the plaintiff is seeking relief for the entire plan rather than individually.

Attorneys representing plan sponsors should take a new look at arbitration clauses and class action waivers and consider modifying existing plan documents to include class action waivers and arbitration clauses going forward.

Listen as our panel discusses the critical issues of the SCOTUS decision in Epic Systems, the impact on plan administration, and best practices for plan sponsors in modifying existing plans or drafting plan provisions in response to the SCOTUS decision.