Employees seeking benefits under an Employee Retirement Income Security Act (ERISA)-governed plan are often surprised to learn that the deck may be stacked against them in the courtroom. Since Firestone Tire & Rubber Co., v. Bruch, 489 U.S. 101 (1983), federal courts have typically reviewed ERISA benefit denials under an abuse of discretion standard where the plan contains a “discretionary clause”-- language delegating authority for benefit decisions to the plan administrator. Under this deferential standard of review, courts uphold the plan administrator’s decision unless it was arbitrary and capricious.
In recent years, a growing number of states have sought to protect employees through laws or regulations designed to eliminate the discretionary clause from ERISA plans and restore a de novo standard of review in benefit claims. These efforts have mostly proven successful. See, e.g., Fontaine v. Metropolitan Life Ins. Co., 800 F.3d 883 (7th Cir. 2015).