Opinion ID: 3037393
Heading Depth: 2
Heading Rank: 2

Heading: “connection with”

Text: [10] The second step of the ERISA pre-emption inquiry is whether a challenged law has an impermissible “connection with” ERISA plans. For essentially the same reasons that the requisite “connection” was lacking in Dillingham and in Nunn, it is lacking here. Dillingham observed that there is a “paucity of indication in ERISA and its legislative history of any intent on the part of Congress to pre-empt state apprenticeship training standards, or state prevailing wage laws that incorporate them.” Id. at 331. Building on that observation, Nunn held that we must apply the “connection with” test with the understanding that “apprenticeship standards are a traditional area of state concern [and] Congress has explicitly encouraged continued state regulation of apprenticeship standards.” 356 F.3d at 986. [11] Nunn observed that “California does not prohibit apprenticeship training programs from operating without state approval, and employers are not required to hire apprentices from state-approved programs or indeed to hire any apprentices at all.” Id. at 982. The same is true in Oregon. Only a program that seeks recognition from Oregon’s State Apprenticeship and Training Council is subject to evaluation under Oregon’s needs requirement. See OR. REV. STAT. § 660.135. Oregon’s scheme does not require that all apprenticeship training programs be registered nor does it govern the functioning or internal organization of unregistered apprentice training committees. Indeed, appellants have existed and functioned in some fashion since 1986 without state approval. That appellants would prefer to attain state recognition because of the financial advantages state recognition offers 5576 OREGON COLUMBIA BRICK MASONS v. GARDNER does not prevent them from training apprentices as they see fit without that recognition. [12] The needs requirement does provide incentives for employers seeking to provide apprenticeship training opportunities to join existing programs. In this sense, it is quite similar to the state law at issue in New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Insurance Co., 514 U.S. 645 (1995). In Travelers, the Supreme Court considered whether ERISA preempted a New York statute that “require[d] hospitals to collect surcharges from patients covered by a commercial insurer but not from patients insured by a Blue Cross/Blue Shield plan, and . . . subject[ed] certain health maintenance organizations . . . to surcharges that var- [ied] with the number of Medicaid recipients each enroll[ed].” 514 U.S. at 649. The Court concluded that “[a]lthough there is no evidence that the surcharges will drive every health insurance consumer to the Blues, they do make the Blues more attractive (or less unattractive) as insurance alternatives and thus have an indirect economic effect on choices made by insurance buyers, including ERISA plans.” Id. at 659. This “indirect economic effect,” basically a channeling mechanism, was insufficient to trigger ERISA preemption in Travelers. Oregon’s needs requirement functions quite similarly: It makes participation in certain apprenticeship programs more attractive, but does not require such participation. [13] In light of Dillingham, Nunn, and Travelers, we can discern no impermissible connection between Oregon’s needs requirement and ERISA.