The Sixth Circuit Court of Appeals has cited the “spirit of ERISA” in reversing a district court decision granting summary judgment against an employee pursuing a disability claim. In Waskiewicz v. Unicare Life & Health Ins. Co., 802 F.3d 851 (6th Cir. 2015) the plaintiff-employee was suffering from mental illness when she was discharged by her employer. At the time of the discharge, Ms. Waskiewicz was insured through a long-term disability insurance plan established by her employer. Ms. Waskiewicz did not timely file her claim, in part owing to her medical condition. The district court dismissed her claim, finding that she had failed to comply with her disability plan’s notice of claim requirements.
The Sixth Circuit reversed the district court finding that, given the claimant’s mental condition, the court’s reading of the language appearing in her disability contract was too strict. The Court held:
While she did not comply with the notification deadlines outlined in Section 4.02 of the Plan, that failure is not surprising given that she was suffering from severe mental illness and was unable to comply due to the very disability for which she sought coverage.
An insurance policy can hardly be said to provide employee disability “insurance” at all if it protects against sudden disability but not if the employer immediately discharges the employee because of the disability before she gets a chance to apply for the benefits. Waskiewicz, 802 F. 3d at 855-866 (emphasis in the original).
Notably, the Court held:
Common sense convinces us that the denial of benefits in this case runs contrary to the spirit of ERISA, which is designed to protect employee benefits, not subject them to arbitrary termination—in this case retroactive termination—after the benefit has otherwise accrued. Id., 856.
The Court’s holding recognizes the unique role that an ERISA plan plays in the financial planning of employees. The Court’s recognition of the “spirit” of the ERISA law may require a court to consider the law’s intended purpose – the financial protection of employees through their employee benefits. Occasionally, this may require a court to look past strict contractual interpretation and focus on the aims of ERISA.