R.R. Donnelley & Sons Co. v. Prevost
| Citation | 915 F.2d 787 |
| Decision Date | 24 September 1990 |
| Docket Number | A,1528,Nos. 1527,AFL-CIO and D,D,AFL-CI,s. 1527 |
| Parties | , 12 Employee Benefits Ca 2472 R.R. DONNELLEY & SONS CO., Plaintiff-Appellant, v. Judy PREVOST; Gerald Kolinsky, Compensation Commissioner, Eighth District, State of Connecticut; John A. Arcudi, Chairman, Board of Compensation Commissioners, State of Connecticut; Clarine Nardi Riddle, Attorney General, State of Connecticut, Defendants-Appellees, United Automobile, Agricultural Implement and Aerospace Workers,istrict 91, International Association of Machinists and Aerospace Workers,mici Curiae. O & G INDUSTRIES, INC., Plaintiff-Appellant, v. John ARCUDI, Edward F. Bradley, Gerald Kolinsky, Gregory Gorman and Sharon Ferrillo Petrushonis, Defendants-Appellees. ockets 89-7467, 89-7481. |
| Court | United States Courts of Appeals. United States Court of Appeals (2nd Circuit) |
Daniel L. Fitzmaurice, Hartford (Thomas Z. Reicher, Felix J. Springer, Day, Berry & Howard, Hartford, Conn., of counsel), for plaintiff-appellant R.R. Donnelley & Sons Co.
Thomas J. Joyce (Thomas M. Cloherty, Murtha, Cullina, Richter and Pinney, Hartford, Conn., of counsel), for plaintiff-appellant O & G Industries, Inc.
Arnold B. Feigin, Asst. Atty. Gen. (Clarine Nardi Riddle, Atty. Gen., State of Conn., Hartford, Conn., of counsel), for defendants-appellees Gerald Kolinsky, John A. Arcudi, Clarine Nardi Riddle, and Edward F. Bradley.
Bianca D. Mackey (Ashcraft & Gerel, Hartford, Conn., of counsel), for defendant-appellee Gregory Gorman.
Geraldine Battistoli, Westbrook, Conn., for defendant-appellee Judy Prevost.
Lindalea P. Ludwick (Sklarz & Early, New Haven, Conn., of counsel), for defendant-appellee Sharon Ferrillo Petrushonis.
Before NEWMAN, PRATT, and MAHONEY, Circuit Judges.
This appeal is brought by plaintiffs-appellants R.R. Donnelley & Sons Co. ("Donnelley") and O & G Industries, Inc. ("O & G") (collectively, the "Employers") from a judgment of the United States District Court for the District of Connecticut, Peter C. Dorsey, Judge. The Employers, entities maintaining employee welfare benefit plans within the meaning of section 3(1) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. Sec. 1002(1) (1988), brought actions seeking a declaration that Conn.Gen.Stat. Sec. 31-284b (1989), which requires Connecticut employers to continue equivalent accident and health insurance and life insurance coverage, or welfare fund payments, for employees eligible to receive workers compensation, 1 is preempted by ERISA.
The district court was thus required to construe section 514(a) of ERISA, 29 U.S.C. Sec. 1144(a) (1988), which provides that ERISA "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title and not exempt under section 1003(b) of this title." 2 The court concluded that although section 31-284b related to employee benefit plans of the Employers described in 29 U.S.C. Sec. 1003(a) (1988), those plans were exempt under 29 U.S.C. Sec. 1003(b)(3) (1988), which exempts (inter alia ) plans "maintained solely for the purpose of complying with applicable workmen's compensation laws." The district court accordingly granted summary judgment to defendants-appellees.
We affirm.
Section 31-284b was enacted in response to Stone & Webster Eng'g Corp. v. Ilsley, 690 F.2d 323 (2d Cir.1982), aff'd mem. sub nom. Arcudi v. Stone & Webster Eng'g Corp., 463 U.S. 1220, 103 S.Ct. 3564, 77 L.Ed.2d 1405 (1983), which declared Conn.Gen.Stat. Sec. 31-51h, 3 a predecessor of section 31-284b, preempted by ERISA. In Stone, we concluded that former section 31-51h related to plans described in section 1003(a) that were not exempt under section 1003(b). On the latter point, we concluded that the "broadly designed" employer plans at issue were not "maintained solely" to comply with applicable workmen's compensation laws within the meaning of section 1003(b)(3). Stone, 690 F.2d at 330.
The Connecticut legislature subsequently replaced section 31-51h with section 31-284b in an effort to take advantage of the section 1003(b)(3) exception. Unlike former section 31-51h, section 31-284b is included in the workers' compensation chapter of the Connecticut General Statutes. More significantly, as will become apparent, subsection (b) of section 31-284b authorizes alternative methods of compliance with the continuation of benefits mandated by subsection (a): (1) insuring the liability, (2) creating a new "injured employee's plan" as an extension of an existing plan, (3) self insurance, or (4) any combination of the above methods. In addition, subsection (c) thereof allows an employer, in the case of an employee welfare fund, to make appropriate payments to the fund to continue the required benefits.
The actions brought by Donnelley and O & G test the design of the new statute. The events which led to this litigation are described below.
Donnelley, a Delaware Corporation with its principal place of business in Chicago, Illinois, conducts business in Connecticut at its Old Saybrook Manufacturing Division in Old Saybrook, Connecticut. Donnelley provides group term life insurance and health and dental benefits to eligible employees and their dependents through employee welfare benefit plans within the meaning of 29 U.S.C. Sec. 1002(1) (1988).
Donnelley's employment policies provide, in relevant part, that:
An employee having a continuous absence due to illness, injury or plant accident will be retained in an active status for two years or a period equivalent to the employee's total length of service from the last date hired to the first day of absence, whichever is less.
If an employee returns to work and sustains a recurring absence, the recurring absence will be added to the prior absence without credit for the interim return to work for the purpose of [the above paragraph], unless the employee performed in a full time assigned position for ninety consecutive calendar days or the recurring absence was due to an unrelated disability.
Upon the termination of their active status, separated employees may, under certain conditions, convert or extend their life, health or dental coverage at their own expense.
Defendant Judy Prevost, a Connecticut resident, began working for Donnelley in May 1983. At some time thereafter, Prevost suffered work-related injuries which resulted in her absence from work from May 1, 1986 to May 25, 1988, except for a brief period in February 1987 when she returned to work. Throughout this period and thereafter, Prevost was receiving or was eligible to receive workers' compensation payments from Donnelley pursuant to Connecticut law.
Until May 25, 1988, Donnelley maintained Prevost in active status, in accordance with the policies quoted hereinabove, and continued to provide her with life insurance and health and dental benefits. By letter dated May 2, 1988, however, Donnelley advised Prevost that her active status with Donnelley would be terminated on May 25, 1988 if she did not return to work prior to that date. That same letter advised Prevost that she could convert her life insurance coverage to an individual policy at her own expense. She was subsequently advised of her right to continue health and dental insurance at her own expense.
Donnelley terminated Prevost's dental benefits on May 25, 1988, health benefits on June 25, 1988, and life insurance coverage on June 26, 1988. By letter to Donnelley dated May 19, 1988, defendant Gerald Kolinsky, a compensation commissioner of the State of Connecticut, advised Donnelley that section 31-284b "requires an employer to continue to provide to an injured employee continuing coverage for group accident and health insurance or life insurance coverage while the employee is eligible to receive or is receiving workers' compensation payments."
Donnelley then filed suit in the United States District Court for the District of Connecticut, seeking injunctive relief and a declaration that section 31-284b is preempted by section 514(a) of ERISA, 29 U.S.C. Sec. 1144(a) (1988). The case was later consolidated with a similar action brought by O & G, described below.
O & G is a Connecticut corporation with its principal place of business in Torrington, Connecticut. O & G is engaged in the construction business in Connecticut and other states, and is a member of the Associated General Contractors of Connecticut, Inc. (the "AGC"). The AGC negotiates on behalf of its members a collective bargaining agreement (the "Agreement") with the Connecticut Laborers District Council (the "Laborers").
As required by the Agreement, O & G contributed a predetermined amount of money for each hour worked by its employees to, inter alia, the Connecticut Laborers Health Fund (the "Health Fund"), an employee welfare benefit plan within the meaning of 29 U.S.C. Sec. 1002(1) (1988) that provides covered employees with medical, life, accidental death and dismemberment, and disability benefits.
Defendant Sharon Ferrillo Petrushonis was first employed by O & G on September 26, 1983. On December 20, 1984, she was injured in the course of her employment with O & G. Defendant Gregory Gorman was first employed by O & G on September 17, 1986. He was injured in the course of that employment on October 14, 1986. Both injured employees were eligible for workers' compensation.
O & G did not make payments to the Health Fund on behalf of Petrushonis and Gorman while they were receiving workers' compensation, since this was not required by the Agreement or the trust agreement establishing the Health Fund. On March 16, 1988, however, defendant Kolinsky ordered O & G to comply with section 31-284b with respect to Petrushonis. Gorman sought a similar determination. His application was pending before the Connecticut authorities when the record for this appeal was closed.
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