Court Opinion

ID: 9491790
Source: CourtListenerOpinion
Date Created: 2023-08-05 14:23:58.885673+00
Date Added: 2024-06-11T17:54:56.833678
License: Public Domain

BRORBY, Circuit Judge,
with whom JOHN C. PORFILIO, STEPHEN H. ANDERSON, and TACHA, Circuit Judges, join, dissenting.
The narrow issue before the en banc court is whether Dr. Walker violated § 510 of ERISA in light of Inter-Modal Rail Employees Ass’n v. Atchison, Topeka & Santa Fe Ry., 520 U.S. 510, 117 S.Ct. 1513, 137 L.Ed.2d 763 (1997). I maintain the panel decision is not foreclosed by Inter-Modal as the majority suggests. I therefore respectfully dissent.
Inter-Modal held that § 510 applies to non-vesting employee welfare plans as well as to vesting pension plans. The Supreme Court based that holding on the fact the plain language of § 510 broadly refers to participation in a “plan,” and makes no attempt to distinguish between rights that “vest” under ERISA and those that do not. By relying on the statutory language itself to answer a specific issue concerning employees’ interests in non-vesting welfare benefits under formalized Railroad Retirement Act and Teamster benefit plans, the Supreme Court simply had no occasion to address whether § 510 offers any protection once an employee has attained the right to participate in an SEP, but can claim no entitlement to a contribution to the SEP, unless and until the employer, at his sole discretion, contributes to the SEP. See Inter-Modal, 520 U.S. 510, 117 S.Ct. at 1516-17 (leaving to court of appeals on remand the issue whether § 510, “when applied to benefits that do not ‘vest,’ only protects an employee’s right to cross the ‘threshold of eligibility’ for welfare benefits”). The majority nevertheless extends the Inter-Modal holding to the unique facts of this case.
In my view, the non-vesting welfare benefits the Supreme Court deemed protected under § 510 in Inter-Modal are fundamentally different from an expectation in the mind of a single employee who requested an SEP contribution in conjunction with her request for a raise, and then, because she administered the payroll, implemented her own raise while the employer was still considering what percentage contribution, if any, to offer as part of the employee’s overall compensation package; The simple, undisputed fact overlooked by the majority is that even as an eligible SEP participant, Ms. Gar-ratt had no promise of nor right to a contribution until her employer actually made a contribution.1 Dr. Walker’s final compensa*1257tion package offer, which included a percentage SEP contribution, if, in fact, he made a contribution for that tax year, is not the same as the contribution itself, and therefore, did not create the type of anticipated “right” or “promised benefit” the Supreme Court found to be protected under § 510 in Inter-Modal.2 520 U.S. 510, 117 S.Ct. at 1515, 1516.
By elevating an employer’s compensation offer to the status of a “right” protected by § 510, the majority has created an onerous trap for the unwary small businessman. An employer can no longer informally negotiate a compensation/benefit package involving a potential SEP contribution with an employee without subjecting himself to ERISA liability. The language of § 510 does not require such a result; nor do-I believe Inter-Modal mandates such a result. Accordingly, I would affirm the district court.

. The majority seems to place great significance on the fact Dr. Walker had contributed to his SEP in the past and, in fact, contributed to both his and Ms. Garratt’s SEPs after she left his employ. These facts are absolutely irrelevant to the issue of whether Ms. Garratt had a protected right when she filed suit against Dr. Walker. Dr. Walker’s contribution history has relevance if and only if it is determined Ms. Garratt had a "right” to which she could claim entitlement under § 510. At that point such facts may be indicative of whether Dr. Walker had a motive or intent to discriminate. Because the decision whether to contribute to the SEPs for any given *1257year was solely within Dr. Walker’s discretion, prior or subsequent decisions cannot be used to create a "right” under § 510 where none otherwise exists.

. The majority quotes from Conkwright v. Westinghouse Elec. Corp., 933 F.2d 231, 237 (4th Cir.1991), to identify the "panoply” of rights protected under ERISA §§ 502 and 510. Protected rights are those
rights about to be earned but frustrated due to unlawful employer action, benefits earned but not paid, other rights due a participant but not fulfilled, and future benefits earned but not yet due.
For the reasons stated, even viewing the record in the light most favorable to Ms. Garrett, she simply cannot identify any benefits due, earned or about to be earned.