Nov 21 (Reuters) – The U.S. Supreme Court docket on Monday turned away a problem to a 2018 Seattle legislation requiring motels to pay for medical health insurance for low-wage staff pursued by a enterprise group that argued the measure violated a federal legislation that regulates worker advantages.
The justices declined to listen to an enchantment by a gaggle referred to as the ERISA Trade Committee (ERIC) of a decrease court docket’s ruling that upheld the legislation. Their determination to not take up the problem might encourage different cities and states to undertake comparable necessities meant to deal with the widespread lack of medical health insurance amongst low-wage staff.
Democratic-governed Seattle’s legislation requires bigger resort operators to supply as much as $1,375 a month in insurance coverage advantages or direct funds to staff. Seattle, with a inhabitants of greater than 700,000 folks, is a metropolis identified for its liberal politics and is the biggest in Washington state.
ERIC is a nonprofit group based mostly within the U.S. capital representing giant employers of their capability as sponsors of worker profit plans for his or her nationwide workforces.
The group’s chief govt officer, Annette Guarisco Fildes, mentioned the Supreme Court docket’s motion permits a conflicting nationwide patchwork of employment legal guidelines to stay.
“The court docket’s failure to resolve this urgent authorized concern now additionally opens the floodgates for states and cities throughout the nation to impose comparable ‘play-or-pay’ mandates on employers,” Fildes mentioned in an announcement.
ERIC sued Seattle in 2018 in federal court docket, arguing that the legislation was barred by the federal Worker Retirement Revenue Safety Act of 1974 (ERISA), which preempts state legal guidelines that try to manage worker profit plans.
A federal choose threw out the case. The San Francisco-based ninth U.S. Circuit Court docket of Appeals final yr upheld the choose’s determination, discovering that the legislation doesn’t require employers to create new plans or amend current ones, thus isn’t barred by ERISA.
In its enchantment to the Supreme Court docket, ERIC mentioned ERISA was designed to create uniform nationwide requirements for worker profit plans and that Seattle’s legislation would upset that scheme by requiring particular therapy for staff in a single business in a single metropolis.
President Joe Biden’s administration backed Seattle within the case, saying the legislation was not preempted by ERISA as a result of it lets employers make direct money funds to staff as an alternative of establishing new profit plans.
ERIC’s enchantment was backed by the U.S. Chamber of Commerce, the nation’s largest enterprise foyer, in addition to the Nationwide Federation of Unbiased Enterprise and the American Resort and Lodging Affiliation.
Reporting by Daniel Wiessner in Albany, New York; Modifying by Will Dunham
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