Insurance

Supreme Court seeks government’s input on Seattle hotel worker insurance law

A hotel worker protests outside airport hotels to demand healthcare coverage extension.., REUTERS/Lucy Nicholson

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  • Business group seeking to revive challenge to 2019 law
  • Lower courts said no conflict with federal law
  • Supreme Court wants solicitor general’s opinion

(Reuters) – The U.S. Supreme Court on Tuesday asked the Biden administration to weigh in on whether a Seattle ordinance requiring hotels to offer health insurance to low-wage workers is prohibited under the federal law regulating employee benefits.

The court invited U.S. Solicitor General Elizabeth Prelogar to file a brief in a bid by the ERISA Industry Committee (ERIC), a business group, to revive its challenge to the 2019 law, which requires larger hotel operators to provide up to $1,375 a month in insurance benefits or direct payments to workers.

Annette Guarisco Fildes, president and CEO of ERIC, said in a statement that the group was encouraged by the court’s request for the government to step in. She said the federal government has in the past suggested that similar local laws are invalid.

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The Seattle City Attorney’s Office did not immediately respond to a request for comment.

The 9th U.S. Circuit Court of Appeals last year rejected the group’s claim that the city law was barred by the federal Employee Retirement Income Security Act of 1974 (ERISA), which preempts state laws that attempt to regulate employee benefit plans.

The 9th Circuit, agreeing with a federal judge in Seattle, said the city’s law does not require employers to create new plans or amend existing ones, and thus was not barred by ERISA.

In a January petition, ERIC told the Supreme Court that the 9th Circuit had adopted too narrow a view of ERISA. The federal law was designed to create uniform nationwide standards for employee benefit plans to follow, and the Seattle law would upset that scheme by requiring special treatment for workers in a single industry in one city, the group said.

ERIC is backed by numerous business groups including the U.S. Chamber of Commerce, National Federation of Independent Business, and the American Hotel and Lodging Association.

The case is ERISA Industry Committee v. City of Seattle, U.S. Supreme Court, No. 21-1019.

For the ERISA Industry Committee: Paul Clement of Kirkland & Ellis

For Seattle: Peter Stris of Stris & Maher; Jeremiah MIller of the Seattle City Attorney’s Office

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Our Standards: The Thomson Reuters Trust Principles.

Daniel Wiessner

Thomson Reuters

Dan Wiessner (@danwiessner) reports on labor and employment and immigration law, including litigation and policy making. He can be reached at daniel.wiessner@thomsonreuters.com.


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