English Only Notices May Not Be Enough To Comply With ERISA

Clifford Geiger
Clifford Geiger

A federal court in Maryland has partially dismissed a complaint filed on behalf of nearly 40 Spanish-speaking current and former employees of Hatfield’s Equipment & Dedication Services Inc.  (“Hatfield’s”).  The plaintiffs, who worked as part of a concrete crew, alleged that Hatfield’s did not comply with the reporting and disclosure requirements for the company’s profit sharing plan, because plan documents and benefit statements were provided to them only in English.  The Employee Retirement Income Security Act (“ERISA”) requires that notices and disclosures be made in a manner calculated to be understood by the average participant. Therefore, the plaintiffs alleged, profit sharing plan documents must be distributed in Spanish, because that is the language read and spoken by the average plan participant.

U.S. District Judge Ellen Lipton Judge Hollander found that ERISA did not require plan documents to be provided in multiple languages.  The Judge noted, however, that the pertinent regulations do not totally ignore the issue presented.  In certain circumstances, a plan administrator is required to provide a special, foreign language notice with an English-language summary plan description.  Specifically, 29 C.F.R. § 2520.102-2 provides, in part:

In the case of either (1) A plan that covers fewer than 100 participants at the beginning of a plan year, and in which 25 percent or more of all plan participants are literate only in the same non-English language, or (2) A plan which covers 100 or more participants at the beginning of the plan year, and which the lesser of (i) 500 or more participants, or (ii) 10% or more of all plan participants are literate only in the same non-English language, so that a summary plan description in English would fail to inform these participants adequately of their rights and obligations under the plan, the plan administrator for such plan shall provide these participants with an English-language summary plan description which prominently displays a notice, in the non-English language common to these participants, offering them assistance.

In this case, the complaint did not contain allegations sufficient to establish that this regulation may apply, so the claim seeking plan documents written in Spanish was dismissed with leave to file an amended complaint.

Melendez  v. Hatfield’s Equipment & Dedication Services, Inc., D. Md., No. 1:13-cv-03684, 8/12/14



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