Every year the United States Supreme Court is faced with the task of deciding what cases it will accept on appeal. There is no way the Court can hear all the cases folks file, nor is it necessary for the justices to hear them all. The Court receives approximately 10,000 petitions for writ of certiorari each year, but only accepts between 75-80 cases. Some of the cases can be of such great importance that the result will affect the lives of every American. Other cases, however, only affect the parties to the lawsuit. Many cases fall somewhere in between. Below is a list of upcoming labor and employment cases that the Unites States Supreme Court has decided to accept. These cases could well have a very big impact on a significant number of American workers.
Tyson Foods Inc. v. Bouaphakeo
In June, the U.S. Supreme Court decided it would hear a case where a jury had returned a verdict for $5.8 million, in favor of a group of employees. The employees were workers at a pork processing facility who brought a wage and hour class action/collective action against alleging Tyson Foods, Inc. didn’t pay them the correct amount of overtime and minimum wages. The trial judge approved the jury verdict and the Eighth Circuit Appeals affirmed. Tyson Foods is arguing that the case should have never been certified because of the vast differences in the individual Plaintiffs. Similarly, they argue that past U.S. Supreme Court opinions, if applied correctly, would have prevented the trial court from certifying the case as a class action.
The reason that this case is so significant is that employees in class actions are almost never identical. Individual employees have “similar” situations and working conditions, but can often react and be treated differently and can certainly be paid different amounts in their jobs. If these differences are deemed to be a barrier to class action treatment, then this may mark the end of class action lawsuits in the employment arena.
Friedrichs v. California Teachers Association
This case was brought by a group of California teachers who wanted to challenge the rule that public employers could require nonunion workers to pay union fees in union-represented bargaining deals. This case is significant because a decision siding with the teachers could hurt unions in the public sector by cutting into their financial support. As many are aware, union participation in America has declined over the years. This case could be a chance to reverse the trend for unions or expedite their troubles.
MHN Government Services Inc. et al. vs. Zaborowski et al.
This is an arbitration case that has been previously discussed in this report. Managed Health Network, Inc. (MHN) is a defense contractor that required its employees to sign a very restrictive arbitration agreement. As a condition of employment, MHN required its employees and contractors to waive their constitutional right to a jury trial and refrain from suing them in court. In addition to the jury trial waiver, MHN’s arbitration agreement severely limits the amount of time an individual has to file an action and requires a filing fee that is 7-15 times higher than normal. The employees and contractors of MHN challenged the arbitration agreement before a federal district court in California. The trial court ruled that the agreement was so restrictive that it was, in fact, unconscionable and not legally enforceable. On appeal, the employees successfully persuaded three judges that they were correct. The court also ruled that the arbitration agreement was not legally enforceable.
MHN will argue that the California rulings were against U.S. Supreme Court precedent and that the law requires the arbitration agreement to be enforced as written. Alternatively, MHN will argue that any parts of the arbitration agreement that are unenforceable should be stricken and the remaining parts of the agreement enforced. The ruling in this case could have far reaching implications concerning how far a company can go in requiring its employees to give up rights as a prerequisite to employment.
Green v. Brennan
This next case concerns how long an employee has to file a claim for discrimination when he knew or should have known there was a problem. Ex-postmaster Marvin Green sued the postal service for race discrimination based on a few different incidents that occurred over a certain time period. Green’s lawsuit was ultimately dismissed because the federal district court said he failed to allege wrongdoing within the amount of time allowed by law. Green argues that the time with which he had to file the lawsuit should start running from the time of the later incidents, and not the earlier incidents. How the Court resolves this case will be helpful to both employees and employers. The final opinion is likely to clarify how long someone has to bring a claim and what episodes trigger when to start counting.
Montanile v. Board of Trustees of the National Elevator Industry Health Benefit Plan
This last case deals with a very common issue. Every day, individuals are injured in accidents through no fault of their own. Many victims’ injuries are covered by medical insurance they paid for through their job. What many people don’t realize is that the health insurance company, or health plan, may want their money back in the event the employee recovers money from the person responsible for causing the accident.
In late 2008, Robert Montanile was involved in a car accident that resulted in significant injuries. Montanile was covered by an employee health benefit plan administered by the Board of Trustees of the National Elevator Industrial Health Benefit Plan (Plan). After Montanile’s accident, the Plan dispersed over $120,000 to cover his medical expenses. Montanile later sued the driver of the other car involved in the accident, eventually obtaining a $500,000 settlement. Per its terms, the Plan then requested that Montanile reimburse the initial $120,000 disbursement. When Montanile and the Plan were unable to reach an agreement, the Plan sued Montanile.
The Plan is governed by the Employee Retirement Income Security Act of 1974 (ERISA), which allows plan administrators to recover overpayment from a beneficiary when the recovery would constitute “appropriate equitable relief”. The trial court held that the terms of the Plan required Montanile to repay the initial $120,000, and that this repayment was appropriate equitable relief in part because the Plan was able to identify a source of funds within Montanile’s possession- the $500,000 settlement. Montanile appealed and claimed that the repayment would not be equitable relief because the settlement had been spent or disbursed to other parties. The U.S. Court of Appeals for the Eleventh Circuit held that, because the Plan had a right to reimbursement, the Plan’s lien against Montanile’s $500,000 settlement attached before Montanile spent or disbursed the funds. Therefore, Montanile could not evade the repayment by claiming the settlement funds had been spent or disbursed.
In other words, the questions is should Montanile have to reimburse his health plan if the money they are requesting has already been spent or disbursed to others? The outcome of this case may have an impact on how insurance companies and health plans settle cases in the future. A ruling against Montanile may also make cases more difficult to settle if health plans are able to demand full reimbursement under any and all circumstances.
We will continue to monitor these cases and will give updates as appropriate. If you need information about any of the cases or the process involved, contact Roman Shaul at 800-898-2034 or by email at Roman.Shaul@beasleyallen.com.
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