Justices side with religious hospitals in pension dispute

Justices side with religious hospitals in pension dispute

Justices side with religious hospitals in pension dispute

"Keeping the church-establishment requirement would have prevented some plans run by pension boards-the very entities the employees say Congress most wanted to benefit-from qualifying as "church plans" under ERISA", the opinion says.

The U.S. Conference of Catholic Bishops insisted, in a previous amicus brief submitted on behalf of the religious hospitals, that the ministries of the religious hospitals should ensure that they are considered part of churches.

Justice Neil Gorsuch did not participate in the decision because he wasn't yet on the bench when the court heard the case earlier this year.

The case turns on a provision of ERISA that always has exempted any plan "established and maintained for its employees by a church".

ERISA states that church plans, or plans "established and maintained for its employees ... by a church", can also be plans "maintained by an organization ... the principal goal or function of which is the administration or funding of a plan or program for the provision of retirement benefits ... for the employees of a church". "Still to be decided is whether government agencies were correct when they ruled that a plan's internal employee benefit committee is the "organization" contemplated by Congress". In a surprising 8-0 ruling, the Court agreed with the Defendants that the exemption applies to pension plans maintained by church affiliated organizations such as healthcare facilities, even if the plans were not established by a church.

Premise 1: A plan established and maintained by a church is an exempt church plan. It noted that the amendment provides that the original definitional phrase will now "include" another-"a plan maintained by [a principal-purpose] organization".

In sum, "b$3 ecause Congress deemed the category of plans "established and maintained by a church" to "include" plans "maintained by" [affiliates], those plans - ..."

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In sum, Justice Kagan held that "u$3 nder the best reading of the statute, a plan maintained by a principal-purpose organization therefore qualifies as a 'church plan, ' regardless of who established it". But Congress did not adopt that ready alternative.

Justice Kagan's analysis began by acknowledging that the term "church plan" initially meant only "a plan established and maintained.by a church". Thus, they say, those organizations should be subject to the statute's employee protections.

It shows how far the court has moved in the still-nascent post-Scalia epoch that an opinion can justify its sense of what Congress could and could not have meant by reference to legislative history, without a single word of objection or qualification. Justice Kagan authored the opinion, with a concurrence by Justice Sotomayor.

"It's an injustice to us all", Ciriello said. The legislative materials in these cases consist nearly entirely of excerpts from committee hearings and scattered floor statements by individual lawmakers - the sort of stuff we have called 'among the least illuminating forms of legislative history.' And even these lowly sources speak at best indirectly to the precise question here.

Maria Stapleton and the other workers claimed that Advocate had failed to meet various safeguards for their plans required by the Employee Retirement Income Security Act.

Judge Sonia Sotomayor filed a concurring opinion though said she was troubled by the outcome. Her concern was based on the notion that "Church-affiliated organizations operate for-profit subsidiaries, employee thousands of people, earn billions of dollars in revenue, and compete with companies that have to comply with ERISA". On that point, of course, only time will tell.

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