DOL involvement in pre-ERISA benefit suit

P/OPINION 75-127


                                                          502

                          May 29, 1975

Dear           :

This is in belated reply to your letter of November
15, 1974 to              . Your letter, without
its enclosures, was received in my office on Friday,
May 2. Normally, our mail handling and distribution
system works well, but occasionally errors are made.
Although I am making inquiries to try to find out
what happened to the enclosures, and why the letter
was so delinquent in arriving at my office, I am
writing now to apologize, on behalf of the Labor
Department, for our delay in responding.

As best I can tell from your letter, you have filed
a suit which involves, as one of its elements and
probably as its primary element, an attempt by a
participant of an employee benefit plan to recover
benefits due him under the terms of the plan. The
suit was apparently filed sometime prior to the
date of your letter to           November 15, 1974
and well before the January 1, 1975 effective date
of the substantive reporting, disclosure, and fiduciary
provisions of Title I of the Employee Retirement
Income Security Act (ERISA).

Regarding causes of actions arising in time prior to
the effective date of ERISA's substantive provisions,
the Labor Department's position is that since there
is no retroactive application of Title I, ERISA,
the Department lacks authority to initiate or intervene
in such actions.

Moreover, your letter indicates that the action is
primarily, if not exclusively, one covered by section
502(a)(1)(B) - an action by a participant to recover
benefits due him under the terms of his plan, to
enforce his rights under the terms of the plan, or
to clarify his rights to future benefits under the
terms of the plan. Such cases are normally disputes
between participants and their plans which are
resolved by reference to the contractual terms of the
plan, trust or collective bargaining agreement. Under
section 502(e)(1), such suits, of all the types of
actions authorized by ERISA, are the only ones which
may be brought in State courts as well as Federal
2


P/OPINION 75-127


courts. Under section 502(h), where the sole purpose
of such a suit is to recover benefits due, a copy
of the complaint need not be filed with the Secretary
of Labor and the Secretary of the Treasury.

As you may imagine, suits of this type are extremely
numerous, and Congress recognized not only the desirability
of leaving the State courts open to such actions, but
also the undesirability of the Federal Government's
becoming involved in such actions which are largely
contractual matters not involving interpretation of
ERISA. Moreover, direct government involvement would
divert scarce resources from other activities which
are our primary responsibility.

For these reasons, even if your letter had been properly
routed and considered when it should have been, the
Labor Department would not participate in        's action.

Again, please accept our apologies for this delay.

Sincerely,