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UNCLAIMED PROPERTY FOCUS is a blog written by and for UPPO members, featuring diverse perspectives and insights from unclaimed property practitioners across the U.S. and Canada. We welcome your submissions to Unclaimed Property Focus. Please contact Tim Dressen via with any questions about submitting a blog post for consideration and refer to our editorial guidelines when writing your blog post. Disclaimer: Information and/or comments to this blog is not intended as a substitute for legal advice on compliance or reporting requirements.


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ERISA Advisory Council Plans Review of Unclaimed Property Practices

Posted By Administration, Thursday, June 13, 2019

The Advisory Council on Employee Welfare and Pension Benefit Plans recently announced it will study permissive transfers of uncashed checks from ERISA plans to state unclaimed property funds. Also known as the ERISA Advisory Council, the group’s purpose is to provide recommendations to the Department of Labor on matters related to Employee Retirement Income Security Act.


Many employee benefit plans have been established under ERISA. A common position for companies to take is that because federal law dictates how benefit plans should be administered under ERISA, states are preempted from claiming the money associated with those plans. 


Announcing its plans to study the issue, the advisory council wrote, “The department has consistently applied a broad view of ERISA preemption of state unclaimed property and escheat laws. However, that guidance does not limit the extent to which a plan representative may voluntarily transfer uncashed checks to a state unclaimed property fund. The 2019 Council’s objective is to review the treatment and procedures utilized by state unclaimed property funds, which may vary significantly between states.”


The council does not plan to address what steps are appropriate to locate missing plan participants. Rather, it intends to explore whether circumstances exist in which voluntary transfers of uncashed distribution checks to a state unclaimed property fund advances the Department of Labor’s goal of reuniting missing participants with their retirement savings. 


The ERISA Advisory Council is scheduled to take up this issue during its next meeting, scheduled for June 25-27, 2019. The council will accept public comments through June 18. 





Tags:  employee benefits  ERISA  retirement accounts 

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Gobeille case backs ERISA preemption argument

Posted By Contribution from Sam Schaunaman, J.D. and GRAC member, Thursday, February 2, 2017

Many employee benefit plans were established under the federal Employee Retirement Income Security Act of 1974, as amended (ERISA). Unclaimed property holders generally take the position that because federal law dictates how benefit plans should be administered under ERISA, states are preempted from claiming the money associated with those plans. A 2016 U.S. Supreme Court decision appears to add support to this position.


Considering the case of Gobeille, Chair of the Vermont Mountain Care Board v. Liberty Mutual Insurance Company, the Supreme Court examined whether Liberty Mutual and its third-party administrator, Blue Cross Blue Shield of Massachusetts, Inc. were required to provide information to Vermont under the state’s disclosure statute.  Liberty Mutual sponsored a self-insured and self-funded health plan that provided health benefits in all 50 states to its employees, their families, and former employees. Vermont issued a subpoena to Blue Cross to provide eligibility, medical claim and pharmacy claim files for the plan’s Vermont members. Liberty Mutual instructed Blue Cross not to comply, and then filed suit, seeking a declaration from the court that ERISA preempts state law and, thus, because the plan is an “employee welfare benefit plan” under ERISA, the company was not compelled to submit the requested information.


The Supreme Court ruled in favor of Liberty Mutual. This decision is significant for unclaimed property holders. If a state regulator cannot compel a benefit plan subject to ERISA to obey a healthcare reporting subpoena, it logically follows that it also cannot compel it to file an unclaimed property report or obey an unclaimed property subpoena.


This decision adds support to existing authorities favoring ERISA preemption:

  1. Literal reading of the statute and legislative history: It is generally accepted that Congress enacted ERISA so plan sponsors would have to comply with only one federal law, rather than a variety of potentially conflicting state laws.  Sen. Jacob Javits (R-N.Y.), a key sponsor of the bill that became ERISA, stated as part of the legislative history to ERISA that, “The emergence of a comprehensive and pervasive federal interest and the interests of uniformity with respect to interstate plans required—but for certain exceptions—the displacement of state action in the field of private employee benefit programs.”
  2. Previous case law: In the 1999 Commonwealth Edison Company v. Vega case, the U.S. Court of Appeals for the Seventh Circuit denied the state of Illinois’s efforts to escheat uncashed benefits checks issued by an ERISA-covered defined benefit plan.
  3. U.S. Department of Labor (DOL) support: The DOL, which administers some ERISA provisions, is on record supporting the law’s preemption of state laws. It has publicly stated this position via advisory opinions and a formal letter to the Uniform Law Commission committee that was drafting the 1995 edition of the Uniform Unclaimed Property Act.


ERISA has been in effect for more than 40 years, but conflicts regarding its preemption of state law related to unclaimed property still arise from time to time. 


This Gobeille case appears to support the proposition that states cannot make any plan covered by ERISA respond to a health care reporting subpoena. If they can’t make such a plan sponsor supply information pursuant to litigation, it would seem they shouldn’t be able to require the filing of escheat reports either. Doing so would require an ERISA plan administrator to become familiar with and adhere to 50 different laws, thus defeating the intent of Congress when passing ERISA.



About the contributor

Sam Schaunaman, senior manager at Ryan AUP and member of the UPPO Government Relations and Advocacy Committee, contributes to UPPO’s monthly litigation update blog posts. Schaunaman has over 26 years of unclaimed property experience in all aspects of unclaimed property and is a frequent author of unclaimed property articles and whitepapers. Schaunaman is a member of the Oklahoma Bar Association.    


Disclaimer: This case summary contains a general description of the case, and neither UPPO nor Ryan, or any of their affiliated or related entities, by means of this summary, is rendering business, financial, legal, tax, reporting or compliance or other professional advice or services.  This summary blog is not a substitute for such professional advice.



Tags:  ERISA  federal preemption  litigation  unclaimed property 

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