Rachel Bethel Dallas
Trial Attorney
Although Texas is an “at-will employment” state, this doctrine has important limits, especially when it comes to your employee benefits.
Federal law protects workers from being targeted for their use of health insurance, retirement plans, and other benefits. That protection comes from ERISA, the Employee Retirement Income Security Act of 1974.
If your employer is working hard to block your access to benefits or punishes you for availing yourself of them, you may have a legal claim.
ERISA is a federal law that governs most employer-provided benefit plans, including:
- Health insurance
- Disability and life insurance
- 401(k) and pension plans
- Severance plans
- Other employer-sponsored welfare benefits
ERISA does more than regulate plan administration. It also protects workers’ rights to access these benefits.
ERISA § 510 makes it unlawful for an employer to fire, discipline, demote, or retaliate against a worker because the worker: is using (or about to use) health insurance, retirement, or other ERISA-covered benefits; might become expensive due to medical care or disabilities; asked about benefits, applied for benefits, or asserted benefit rights; and/or gave information or participated in a benefits-related complaint or investigation.
When Employers Interfere with Your Benefits
ERISA makes it unlawful for an employer to take an adverse action against you for the purpose of preventing you from obtaining or keeping benefits. Your employer cannot target you to avoid covering your benefits.
Employers seeking to interfere with or block one’s benefits might fire an employee shortly before their health coverage would begin; terminate a worker right before their pension vests; reduce a worker’s hours to prevent benefits eligibility thresholds; force resignation after a serious medical diagnosis; or eliminate a position to avoid expensive treatment costs.
The key thing to look out for is intent. If a motivating reason for the employer’s adverse action was to prevent you from accessing your benefits, that may give rise to an ERISA claim.
An employee has to show that an employer’s adverse action was taken with the specific intent to interfere with the employee’s rights to benefits or to retaliate against the employee for enjoying their rights to benefits. The loss of benefits after a termination has to be a motivating reason for the adverse action, not just a consequence of the adverse action.
Specific intent can be established with circumstantial evidence. Look out for suspicious timing, shifting explanations, and comparators.
When Employers Punish You for Enjoying your Benefits
ERISA also protects workers who assert their benefit rights, which is protected activity under ERISA. Your employer may not retaliate against you for requesting use of plan benefits; availing yourself of plan benefits; filing a benefits claim or appeal; or asking questions about coverage.
Retaliation might look like an unexpected, unwarranted demotion, pay cut, performance improvement plan, or negative performance review, reduced hours, reduced scope, loss of title, or even termination.
If you believe your employer has interfered with your benefits or retaliated against you, you might want to consult with a Dallas employment lawyer for guidance.