# Petition for Writ of Certiorari — Hannaford Bros. v. Ciampi

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1997
- **Citation:** 519 U.S. 1056

## Text

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No ig Ob THE CLERK

In The

Supreme Court of the United States

October Term, 1996
*

HANNAFORD BROS. CO.,

Petitioner,

THERESA CIAMPI,
Respondent.

¢

Petition For A Writ Of Certiorari
To The Supreme Judicial Court Of Maine

¢

PETITION FOR A WRIT OF CERTIORARI
*

WILLIAM J. KayatTa, Jr.,
(Counsel of Record)
Prerce ATwoop

One Monument Square
Portland, Maine 04101
(207) 791-1100

JOHN F. LAMBERT, Jr.

BLack, LAMBERT, COFFIN & RUDMAN
477 Congress St. 14th Floor

P.O. Box 15215

Portland, Maine 04112-5215

(207) 871-7033

Counsel for Petitioner

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED

Whether a state workers’ compensation statute, requiring
employers who administer ERISA-covered employee ben-
efit plans to include in an inactive employee’s average
weekly wage “any fringe or other benefit that does not
continue during the disability,” relates to an ERISA-cov-
ered employee benefit plan within the meaning of
ERISA’s preemption provisions, and conflicts with the
holdings of this Court in District of Columbia v. Greater
Washington Bd. of Trade, 506 U.S. 125 (1992).

il

TABLE OF CONTENTS

Page
QUESTION PREGGO Fai 64 oc 30 RECO ie is i
CPF SPRUE MEATUS 0.5.5 ic be 0 0hs baw ak shes sbekeeiaa eel 1
PUR oe ees BT wx patnicas veg bn scale Cas eae aos 1
STATUTORY PROVISIONS INVOLVED............. 1
STAT Eames CP Tete Ces ds ciivcawtecsssicct as 4
REASONS FOR GRANTING THE WRIT ........... 8

I. THE DECISION BELOW POSES A PRESENT
AND GROWING THREAT TO THE FEDERAL
REGULATORY UNIFORMITY MANDATED

OY CAPs 6 0 nosh cen oeedanaeeeeaueepnns 8
II. THE COURT BELOW ERRED ON THE
WER ahs. « 65 so kn cd dein thay) Maas eae aad 11
COIMCLLSLIS 5 cbs énsndcnakpeeeneeeneseeeer bones 13
APPENDIX
Opinion of the Supreme Judicial Court of Maine
(july 26, 2996)... ceive vveengaa cede seeaeee App. 1

Decision of the State of Maine Workers’ Compen-
sation Board (April 19, 1995) .........+...56. App. 12

iii

TABLE OF AUTHORITIES

Page
Cases
Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504

oS SARE SE ARR peg ane ROP a yO ne ene rede 9, 10
Carlo v. Reed Rolled Thread Die Co., 49 F.3d 790 (1st

ee EE Se ae eh EAGT Vda RUE D EAS bo De ced ee 12
Ciampi v. Hannaford Bros. Co., 681 A.2d 4 (Me.

SRNR TA en aac chehienicnscareae ceases passim
District of Columbia v. Greater Washington Bd. of

Sg Se. Crit’ Bee RRO bo ocwe ks bak 0 6 09-4 b 00 40's passim
Ebmer v. Wayne Village, 494 N.W.2d 842 (Mich.

PN BEET powh aoe brent ce UNREAD Beebo a Kou wanes ve s, 8
Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987) ..... 8
Ingersoll-Rand Co. v. McClendon, 498 U.S. 133

Lo) SSR Ya ESE AB RE eLearn ane PEC Or 12

Lawrence Paper Co. v. Gomez, 897 P.2d 134 (Kan.),
cert. denied, U.S. __, 116 S.Ct. 187 (1995) ..10, 11

Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41 (1987) ...... 9
Shaw v. Delta Air Lines, Inc., 463 U.S. 85 (1983)....... 9
Vartanian v. Monsanto Co., 14 F.3d 697 (1st Cir.

Ce MEG pc sk aki s tbe Ge c sak Webs ae neh ewenet 12

STATUTES

ee LS, Gib eas Vales whew Re cok s wwe sexes i
PLA. Se © 25-5116) (1997) oo seve cess Septet aM
ALASKA Stat. §§ 23.30.220, 265(15) (1990)........... i

Coto. Rev. Stat. § 8-70-101 (Supp. 1995)........... 7, 10

iv

TABLE OF AUTHORITIES -— Continued

Page
Employee Retirement Income Security Act of 1974,
Eo Wiha: EE WER na ed aw Wick Rh be ee oh 1
ogee Te Ee ee oe es ae ary tLe 2
BD Wis ANA 8 ENT Cesk ae. Fe ee ees Seulae passim
BP ELDAR RUE 6 0 45) 0a hae 53 Ce fae ane heey enone 12
Fra. Stat. ANN. § 440.02(24) (West Supp. 1993) ....7, 10
Kan. Stat. ANN. § 44-511(a)(2) (1993).............. 7, 10
Maine Workers’ Compensation Act of 1992,
39-A M.R.S.A. §§ 101-909 (Supp. 1996)............. 2
Sas Wc, TOIT i 6b Sev ieenee bees passim
SA NERA Bees xiv hei ob vias iva ce eae vanes 1
Mico. Comp. Laws § 418.371(2) (1985).............. 7, 10
OTHER

2A. Larson, THE LAw oF WorRKMEN’S COMPENSATION
© GO Fars Ce eri sadakscaavind dewdes es ieee 7

PETITION FOR A WRIT OF CERTIORARI

Hannaford Bros. Co. petitions this Court for a writ of
certiorari t~ review a decision of the Supreme Judicial
Court of Maine.

OPINIONS BELOW

The July 26, 1996 decision of the Supreme Judicial
Court of Maine is reported at 681 A.2d 4. (App. 1-11). The
April 19, 1995 decision of the State of Maine Workers’
Compensation Board is not reported. (App. 12-14).

The Supreme Judicial Court of Maine granted Peti-
tioner’s petition for appellate review pursuant to 39-A
M.R.S.A. § 322.

JURISDICTION

The decision of the State of Maine Workers’ Compen-
sation Board was issued on April 19, 1995. The judgment
of the Supreme Judicial Court of Maine determining that
ERISA does not preempt the state statute was entered on
July 26, 1996.

This Court has jurisdiction pursuant to 28 U.S.C.
§ 1257(a).

STATUTORY PROVISIONS INVOLVED

The case involves both the Employee Retirement
Income Security Act of 1974 (“ERISA”), 29 U.S.C.

§§ 1001-1461, and provisions of the Maine Workers’ Com-
pensation Act of 1992 (“MWCA”), 39-A M.R.S.A. |
§§ 101-909 (Supp. 1996).

The relevant provisions of ERISA provide as follows:
29 U.S.C. § 1144. Other laws
(a) Supersedure; effective date

Except as provided in subsection (b) of this sec-
tion, the provisions of this subchapter and sub-
chapter III of this chapter shall supersede any
and all State laws insofar as they may now or
hereafter relate to any employee benefit plan
described in section 1003(a) of this title and not
exempt under section 1003(b) of this title. This
section shall take effect on January 1, 1975.

29 S.C. § 1003

(a) Except as provided in subsection (b) of this
section and in sections 1051, 1081, and 1101 of
this title, this subchapter shall apply to any
employee benefit plan if it is established or
maintained —

(1) by any employer engaged in commerce
or in any industry or activity affecting com-
: merce; or

(2) by any employee organization or orga-
nizations representing employees engaged
in commerce or in any industry or activity
affecting commerce; or

(3) by both.

(b) The provisions of this subchapter shall not
apply to any employee benefit plan if -

nn TR nT w

(3) such plan is maintained solely for the
purpose of complying with applicable
workmen’s compensation laws or unem-
ployment compensation or disability insur-
ance laws... .

The relevant provisions of MWCA provides as fol-
lows:

39-A M.R.S.A. § 102.

As used in this Part, unless the context oth-
erwise indicates, the following terms have the
following meanings.

4. Average weekly wages or average
weekly wages, earnings or salary. The term
“average weekly wages” or “average weekly
wages, earnings or salary” is defined as follows.

A. “Average weekly wages, earnings or
salary” of an injured employee means the
amount that the employee was receiving at
the time of the injury for the hours and days
constituting a regular full working week in
the employment or occupation in which the
employee was engaged when injured. . . .

H. “Average weekly wages, earnings or
salary” does not include any fringe or other
benefits paid by the employer that continue
during the disability. Any fringe or other
benefit paid by the employer that does not
continue during the disability must be
included for purposes of determining an
employee’s average weekly wage to the
extent that the inclusion of the fringe or

other benefit will not result in a weekly
benefit amount that is greater than 2/3 of
the state average weekly wage at the time of

injury.

STATEMENT OF THE CASE

This petition for a writ of certiorari arises from a
judgment of the Supreme Judicial Court of Maine (“Law
Court”) holding that ERISA does not preempt 39-A
M.R.S.A. § 102(4)(H) (“Section 102(4)(H)”), a state statute
requiring employers, under certain circumstances, to
include in the computation of a workers’ compensation
average weekly wage the value of the fringe benefits
afforded the employee via the employer’s ERISA-covered
benefit plan.

The facts of this case are not in dispute and, along
with the procedural history, may be summarized as fol-
lows: Respondent Theresa Ciampi suffered a work related
injury on January 30, 1993 while employed by Petitioner
Hannaford. Respondent sought and received workers’
compensation benefits for her injury. While an active
employee of Petitioner, Respondent received fringe bene-
fits including medical, dental and group life insurances,
as well as pension, 401(k) and profit-sharing plans. These
benefits were discontinued during the period of Respon-
dent’s disability.

Although Respondent's workers’ compensation bene-
fits were set at a level in accordance with her average
weekly wage at the time of her injury, Respondent filed a
petition with the State of Maine Workers’ Compensation
Board (the “Board”) seeking, pursuant to Section
102(4)(H),? to include in her average weekly wage the
value of the fringe benefits that she had been receiving
while an active employee of Petitioner.?

1 39-A M.R.S.A. § 102(4) provides in pertinent part:

4. Average weekly wages or average weekly wages,
earnings or salary. The term “average weekly wages”
or “average weekly wages, earnings or salary” is
defined as follows.

A “Average weekly wages, earnings or salary” of
an injured employee means the amount that the
employee was receiving at the time of the injury for
the hours and days constituting a regular full
working week in the employment or occupation in
which the employee wus engaged when injured. . . .

H. “Average weekly wages, earnings or salary”
does not include any fringe or other benefits paid by
the employer that continue during the disability. Any
fringe or other benefit paid by the employer that does
not continue during the disability must be included
for purposes of deterinining an employee’s average
weekly wage to the extent that the inclusion of the
fringe or other benefit will not result in a weekly
benefit amount that is greater than 2/3 of the state
average weekly wage at the time of injury.

? Pursuant to the provisions of Section 102(4)(H), the
Petitioner, and like employers, are given the “choice” of either
continuing the employee’s fringe benefits while the employee is
inactive, or paying the cash equivalent by increasing the
employee’s average weekly wage. Given that this Court has

Petitioner objected to Respondent’s petition, assert-
ing that Section 1144(a) of ERISA preempted Section
102(4)(H). The Board, however, determined that it was
without jurisdiction to address the preemption issue and,
accordingly, proceeded to consider Respondent's petition
pursuant only to state law. (App. 14). Applying Section
102(4)(H), the Board granted Respondent’s petition, find-
ing that including in her average weekly wage the value
of the fringe benefits would not result in weekly compen-
sation greater than two-thirds of the state average weekly
wage. (Id.).

The Law Court granted Petitioner’s timely appeal
from the decision of the Board. In its judgment affirming
the Board’s decision and rejecting Petitioner’s ERISA pre-
emption argument, the Law Court first noted that “[t]here
is no dispute that Hannaford’s fringe benefit package
qualifies as [an employee benefit plan] for purposes of
ERISA.” Ciampi v. Hannaford Bros. Co., 681 A.2d 4, 7, n.1
(Me. 1996) (App. 4). The Law Court furthermore acknowl-
edged the broad preemption provision of ERISA as well as
this Court’s decision in District of Columbia v. Greater Wash-
ington Bd. of Trade, 506 U.S. 125 (1992), which mandated
that “because health insurance plans are regulated by
ERISA, ‘any state law imposing requirements by reference
to such covered programs must yield to ERISA.’ ” Ciampi,
681 A.2d at 7 (quoting Greater Washington, 506 U.S. at
130-31) (App. 5-6).

already prohibited states from requiring the continuation of
actual benefits, District of Columbia v. Greater Washington Bd. of
Trade, 506 U.S. 125 (1992), the state is limited to requiring only
the latter.

The Law Court nevertheless determined that ERISA
does not preempt Section 102(4)(H), finding, inter alia,
that the statute

has only an indirect impact on ERISA-regulated
benefit plans. . . . Had the [Maine] Legislature
intended to encourage employers to continue
benefits during the course of an employee’s dis-
ability, it would have applied section 102(4)(H)
across the board to all employees, as the District
of Columbia had done with its statute in Greater
Washington, and not merely to those employees
whose weekly benefits are less than two-thirds
of the state average weekly wage on the date of
the injury.

Id. at 8, 9 (App. 6, 10).

In support of this holding, the Law Court cited simi-
lar statutes from other jurisdictions, noting that “Maine is
not alone in permitting the consideration of fringe bene-
fits in an employee’s pre-injury wage.” Id. at 8 (citing
Ata. Cope § 25-5-1(6) (1992); Atasxa Stat. §§ 23.30.220,
265(15) (1990); Coro. Rev. Stat. § 8-70-101 (Supp. 1995);
Fra. Stat. ANN. § 440.02(24) (West Supp. 1993); Kan. Stat.
ANN. § 44-511(a)(2) (1993); MicH. Comp. Laws § 418.371(2)
(1985); Ebmer v. Wayne Village, 494 N.W.2d 842, 844 (Mich.
App. 1992);5 2A. Larson, THE Law or WorKMEN’s COMPEN-
SATION § 60.12(b) (1993)) (App. 8).

7

3 The court in Ebmer v. Wayne Village, supra, did not address
federal preemption of the statute cited by the Law Court in
Ciampi. Rather, the Ebmer court determined only that “the
employer’s social security and unemployment compensation
contributions and the employer’s payments to secure workers’

REASONS FOR GRANTING THE WRIT

The decision below arises out of an effort by the State
of Maine to evade both the holding and import of this
Court’s decision in Greater Washington. The decision rep-
resents a growing trend in this respect, and poses a
present, significant threat to the federally preemptive
scheme that is at the heart of ERISA. By denying the writ,
the Court will add impetus to this trend, thus undercut-
ting the important policies of uniformity, as articulated
by this Court in Greater Washington, that Congress sought
to further in crafting the broad preemptive provisions
within ERISA. The issue is well developed and well
framed on the record in this case, and addresses a subject
matter that directly affects ERISA plan administrators
that do business in any of the multitude of states that
have joined this trend.

I. THE DECISION BELOW POSES A PRESENT AND
GROWING THREAT TO THE FEDERAL REGULA-
TORY UNIFORMITY MANDATED BY CONGRESS.

One of the principle goals of ERISA was the creation
of a uniform regulatory scheme for employee benefit
plans. Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 9
(1987). This scheme “is difficult to achieve . . . if a benefit
plan is subject to differing regulatory requirements in
differing States.” Id.

compensation benefits are not to be included in computing an
injured worker’s average weekly wage. ...” Ebmer, 494 N.W.2d
at 843.

all

To achieve the goal of national uniformity, ERISA
maintains, in 29 U.S.C. § 1144(a), a broad preemption
provision that supersedes any State law that “may now or
hereafter relate to any employee benefit plan” described
in, and not exempted by, ERISA. “The only relevant state
laws, or portions thereof, that survive this pre-emption
provision are those relating to plans that are themselves
exempted from ERISA’s scope.” Alessi v. ..aybestos-Man-
hatten, Inc., 451 U.S. 504, 523, n.20 (1981); see also Shaw v.
Delta Air Lines, Inc., 463 U.S. 85 (1983) (emphasizing that
ERISA’s preemption clause is not limited to “state laws
specifically designed to affect employee benefit plans.”);
Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 46 (1987) (noting
the breadth and importance of ERISA’s preemption provi-
sion as intended by its House and Senate sponsors:
“[T]he ‘reservation to Federal authority the sole power to
regulate the field of employee benefit plans’ [i]s ERISA’s
‘crowning achievement.’ ”) (citing 120 Cong. Rec. 29197
(1974) (statement of Rep. Dent)).

The interplay between ERISA and state workers’
compensation laws is “unusually important,” Greater
Washington, 506 U.S. at 132 (Stevens, J., dissenting), and
provides a frequent threat to the uniformity envisioned
by Congress. In Greater Washington the Court found pre-
empted a District of Columbia law stating that employers
that provide health benefits to their active employees
must provide equivalent benefits to an out of work
employee receiving workers compensation. By that deci-
sion, this Court attempted to draw a firm line protecting
the uniformity of benefit plan regulation in furtherance of

congressional intent.

10

Notwithstanding this guidance, state legislatures per-
sist in attempting to circumvent Greater Washington.
Rather than ordering the payment of ERISA benefits, the
current approach is for the state to order the payment of
the value of ERISA benefits. See, e.g., 39 M.R.S.A.
§ 102(4)(H); Ava. Cope § 25-5-1(6) (1992); ALasKka Stat.
§§ 23.30.220, 265(15) (1990); Coro. Rev. Stat. § 8-70-101
(Supp. 1995); Fra. Stat. ANN. § 440.02(24) (West Supp.
1993); Kan. Stat. ANN. § 44-511(a)(2) (1993); MicH. Comp.
Laws § 418.371(2) (1985). As explained in Part II, belew,
the “value of benefits” approach is in direct conflict with
the principles articulated in Greater Washington, and is
apparently predicated on the belief that this Court did
not mean what it said in Greater Washington. In fact, the
Maine law at issue here is precisely the type of law that
Justice Stevens, in his dissent in Greater Washington, said
was rejected by the majority decision. Id. at 133.

Review by this Court of the present case is necessary
not only because the decision below subverts the princi-
ples articulated in Greater Washington, see Alessi, 451 U.S.
at 525 (“ERISA’s authors clearly meant to preclude the
States from avoiding through form the substance of the
pre-emption provision.”), but more importantly, because
the “value of benefits” approach is acquiring a momen-
tum that poses a present, nationwide threat to the uniform
regulation of ERISA benefits mandated by Congress. Last
year, this Court denied a writ of certiorari from the
decision of the Kansas Supreme Court upholding this
approach. See Lawrence Paper Co. v. Gomez, 897 P.2d 134,
138 (Kan.), cert. denied, __ U.S. __, 116 S.Ct. 187 (1995).
The Maine Law Court in Ciampi has now cited the Kansas
decision to sustain a similar law in Maine. Ciampi, 681

iii

11

A.2d at 9 (App. 11). Last year’s decision to deny certiorari
in Lawrence Paper is thus enhancing the growth of a
significant threat to regulatory uniformity, with long last-
ing ramifications that will not be remedied by a decision
many years in the future.

Allowing this approach to stand and proliferate is
counter to the very notion of uniformity intended by
Congress in this area. Benefit plans (as here) often cover
employees in many states, and require that the employer
make long lasting decisions based on multiple year, actu-
arial calculations.

Finally, as explained below, the decision is so plainly
contrary to the express holding in Greater Washington that
granting the requested writ will not place a disproportio-
nate demand on the Court’s resources.

Il. THE COURT BELOW ERRED ON THE MERITS

By including within its scope “[a]ny fringe or other
benefit paid by the employer,” Section 102(4)(H) plainly
and expressly refers to ERISA-covered benefit plans. This
Court has expressly held that such a reference, by itself,
requires a finding of preemption. Greater Washington, 506
U.S. at 130 (“District’s Equity Amendment Act. . . on that
basis alone is pre-empted.”).

Moreover, Section 102(4)(H) imposes its requirements
by reference to benefit plans covered by ERISA. To wit,
the plan administrator must reference the fringe benefits
that were provided via the ERISA plan to the employee
while active, compute their equivalent cash value, and
increase the inactive employee’s average weekly wage by

12

that amount. See Greater Washington, 506 U.S. at 130
(“Such employer-sponsored health insurance programs
are subject to ERISA regulation . . . and any state law
imposing requirements by reference to such covered pro-
grams must yield to ERISA.”) (footnote omitted); Inger-
soll-Rand Co. v. McClendon, 498 U.S. 133, 136 (1990)
(ERISA preempts claim “premised on” existence of
ERISA-covered plan); Carlo v. Reed Rolled Thread Die Co.,
49 F.3d 790, 793-94 (1st Cir. 1995) (where determination of
damages ultimately depended on analysis of an employee
benefit plan, inquiry was directed to plan and cause of
action was preempted); Vartanian v. Monsanto Co., 14 F.3d
697, 700 (1st Cir. 1994) (cause of action preempted where
determination of employer’s liability depended on exis-
tence of an ERISA-covered plan).

In a real economic sense, the decision below, if
allowed to stand, guts this Court’s decision in Greater
Washington of any meaning. Requiring employers to pay
the value of a benefit is no different than requiring the
furnishing of an equivalent benefit. For example, as per-
mitted by federal law, the Petitioner’s benefit plan
requires COBRA beneficiaries to pay the full cost of their
coverage. See 29 U.S.C. § 1162(3). If the COBRA benefici-
ary is entitled to workers’ compensation, however, Sec-
tion 102(4)(H) effectively precludes the Petitioner from
requiring this employee contribution because if the for-
mer employee remits the full cost of the COBRA coverage
to the Petitioner, the Petitioner must simultaneously pay
to that employee the “value” of the health benefits cover-
age (i.e., the full cost of the COBRA coverage).

Justice Stevens formulated the issue in Greater Wash-
ington as “whether Congress intended to prevent a State

13

from computing workmen’s compensation benefits on the
basis of the entire remuneration of injured employees
when a portion of that remuneration is provided by an
employee benefit plan.” Id. at 133 (Stevens, J., dissenting).
If Justice Stevens was correct in that formulation, then the
issue here presented has been decided and, accordingly,
this case is ripe for summary reversal. If Justice Stevens
was incorrect, and the holding in Greater Washington is to
be interpreted more narrowly, a definitive statement by
the Court is necessary to enable ERISA administrators at
least to plan accordingly in assessing the costs of benefit
plans.

CONCLUSION

The decision of the Supreme Judicial Court of Maine,
interpreting the broad preemption provision within
ERISA in a way that permits the State (and other states
with similar statutes) to require employers to provide in
cash what it cannot require in actual coverage, subverts
congressional intent and is in conflict with the principles
articulated in the precedents of this Court. This petition

14

should be granted to resolve this conflict and to restore
among the states uniform application of ERISA.

Respectfully submitted,

WituiaM J. Kayartta, Jr.,
(Counsel of Record)
Prerce ATwoop

One Monument Square
Portland, Maine 04101
(207) 791-1100

JOHN F. LAMBERT, Jr.

BLack, LAMBERT, COFFIN & RUDMAN
477 Congress St. 14th Floor

P.O. Box 15215

Portland, Maine 04112-5215

(207) 871-7033

App. 1

Theresa CIAMPI
v.
HANNAFORD BROS. CO.

Decision No. 7747.
Law Docket No. WCB-95-276.

Supreme Judicial Court of Maine.
Argued June 13, 1996.
Decided July 26, 1996.

James J. MacAdam (orally), McTeague, Higbee, Mac-
adam, Case, Watson & Cohen, Topsham, for Employee.

John F. Lambert, Jr. (orally) and Thomas W. Laprade,
Black, Lambert, Coffin & Rudman, Portland, for
Employer.

Before WATHEN, C.J., and ROBERTS, GLASSMAN,
RUDMAN and LIPEZ, JJ.

ROBERTS, Justice.

Hannaford Bros. Co. appeals from a decision of the
Workers’ Compensation Board awarding its employee
Theresa Ciampi weekly benefits based on a computation
of her average weekly wage that included fringe benefits
pursuant to 39-A M.R.S.A. § 102(4)(H) (Supp.1995).
Hannaford contends that section 102(4)(H) is preempted
by the Employee Retirement Income Security Act of 1974
(ERISA), 88 Stat. 832 (codified as amended at 29 U.S.C.
§§ 1001-1461 (1990)). We conclude that section 102(4)(H)
does not “relate to” an employee benefit plan within the
meaning of ERISA’s preemption provision, and therefore
we affirm the decision of the Board.

App. 2

The facts of this case are not in dispute. Ciampi
suffered a work-related injury on January 30, 1993, while
employed by Hannaford. Her fringe benefits were discon-
tinued during the period of her disability. Ciampi filed a
petition for an award seeking the inclusion of fringe
benefits, valued at $62.50 per week, in her average
weekly wage. Because the inclusion of the fringe benefits
would not increase her weekly benefits above two-thirds
of the state average weekly wage at the time of her injury,
the Board granted the petition. 39-A M.R.S.A. § 102(4)(H);
Beaulieu v. Maine Medical Ctr., 675 A.2d 110, 111
(Me.1996). Concluding that it lacked jurisdiction to
resolve issues of federal preemption, the Board declined
to address Hannaford’s argument that section 102(4)(H)
is preempted by ERISA. We granted Hannaford’s petition
for appellate review pursuant to 39-A M.R.S.A. § 322
(Supp.1995).

ERISA was enacted in 1974 for the purpose of pro-
tecting the interests of employees and their beneficiaries
in employer-provided benefit plans. The United States
Supreme Court recently stated:

[ERISA] does not go about protecting plan par-
ticipants and their beneficiaries by requiring
employers to provide any given set of minimum
benefits, but instead controls the administration
of benefit plans . . . as by imposing reporting
and disclosure mandates, . . . participation and
vesting requirements, . . . funding stan-
dards, . . . and fiduciary responsibilities for plan
administrators. . . . It envisions administrative
oversight, imposes criminal sanctions, and
establishes a comprehensive civil enforcement
scheme.

App. 3

New York State Conf. of Blue Cross & Blue Shield
Plans v. Travelers Ins. Co., ___ US. __, __, 115 S.Ct.
1671, 1674-75, 131 L.Ed.2d 695 (citations omitted). ERISA
also contains a broad preemption provision for the pur-
pose of insuring uniformity in the laws relating to
employee benefit plans. 29 U.S.C. § 1144(a). As the
Supreme Court has explained:

An employer that makes a commitment system-
atically to pay certain benefits undertakes a host
of obligations, such as determining the eligi-
bility of claimants, calculating benefit levels,
making disbursements, monitoring the avail-
ability of funds for benefit payments, and keep-
ing appropriate records in order to comply with
applicable reporting requirements. The most
efficient way to meet these responsibilities is to
establish a uniform administrative scheme,
which provides a set of standard procedures to
guide processing of claims and disbursement of
benefits. Such a system is difficult to achieve,
however, if a benefit plan is subject to differing
regulatory requirements in differing States. A
plan would be required to keep certain records
in some States but not in others; to make certain
benefits available in some States but not in
others; to process claims in a certain way in
some States but not in others; and to comply
with certain fiduciary standards in some States
but not in others.

Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 9, 107
S.Ct. 2211, 2216, 96 L.Ed.2d 1 (1987). In pertinent part,
section 1144(a) provides that “[e]xcept as provided in
subsection (b) of this section, the provisions of this
title . . . shall supersede any and all State laws insofar as

App. 4

they may now or hereafter relate to any employee benefit
plan described in section 4(a) and not exempt under
section 4(b).” 29 U.S.C. § 1144(a) (emphasis added). Sub-
section 4(b) provides that “[t]he provisions of this title
shall not apply to any employee benefit pian if . . . (3)
such plan is maintained solely for the purpose of comply-
ing with applicable workmen’s compensation laws or
unemployment compensation or disability insurance
laws.” 29 U.S.C. § 1003(b)(3).

Hannaford contends that 39-A M.R.S.A. § 102(4)(H)
“relates to” an ERISA benefit plan-and is therefore pre-
empted by ERISA.! Section 102(4)(H) provides:

H. “Average weekly wages, earnings or salary”
does not include any fringe or other benefits
paid by the employer that continue during the
disability. Any fringe or other benefit paid by
the employer that does not continue during the
disability must be included for purposes of
determining an employee’s average weekly
wage to the extent that the inclusion of the
fringe or other benefit will not result in 2 weekly
benefit amount that is greater than 2/3 of the
state average weekly wage at the time of the
injury.

The test for determining whether state legislation
“relates to” an ERISA benefit plan is whether “in the

1 An “employee benefit plan” is defined as either a
“welfare” or “pension” plan. Welfare plans are defined as
providing medical, disability, death, accident, unemployment,
or related benefits, while pension plans relate generally to
retirement. 29 U.S.C. § 1002(1)-(3). There is no dispute that
Hannaford’s fringe benefit package qualifies as a welfare plan
for purposes of ERISA.

Oe RTT TT

App. 5

normal sense of the phrase, . . . it has a connection with or
reference to such a plan.” Shaw v. Delta Air Lines, Inc.,
463 U.S. 85, 97, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983).
Hannaford rests its argument primarily on the Supreme
Court’s recent decision in District of Columbia v. Greater
Washington Bd. of Trade, 506 U.S. 125, 113 S.Ct. 580, 121
L.Ed.2d 513 (1992). Greater Washington dealt with a Dis-
trict of Columbia statute that required employers who
provide health insurance coverage to employees to con-
tinue that coverage during the period that those
employees receive workers’ compensation benefits. Id. at
128, 113 S.Ct. at 582-83. The District of Columbia statute
provided in pertinent part:

(1) Any employer who provides health insur-
ance coverage for an employee shall provide
health insurance coverage equivalent to the
existing health insurance coverage of the
employee while the employee receives or is eli-
gible to receive workers’ compensation benefits
under this act.

(3) The provision of health insurance coverage
shall not exceed 52 weeks and shall be at the
same benefit level that the employee had at the
time the employee received or was eligible to
receive workers’ compensation benefits.

Greater Washington Bd. of Trade v. District of Colum-
bia, 948 F.2d 1317, 1319 (D.C.Cir.1991), aff’d sub. nom.
District of Columbia v. Greater Washington Bd. of Trade,
506 U.S. 125, 113 S.Ct. 580, 121 L.Ed.2d 513. The Supreme
Court stated in Greater Washington that because health
insurance plans are regulated by ERISA, “any state law

App. 6

imposing requirements by reference to such covered pro-
grams must yield to ERISA.” Greater Washington, 506
U.S. at 130-31, 113 S.Ct. at 584. The Court stated further
that the District of Columbia statute “specifically refers to
welfare benefit plans regulated by ERISA and on that
basis alone is pre-empted.” Id. at 130, 113 S.Ct. at 583.

Hannaford contends that, pursuant to Greater Wash-
ington, any express reference to an ERISA plan, regard-
less of the intent of the statute or its actual connection
with an ERISA plan, requires a finding that the law
“relates to” an ERISA plan. Hannaford contends further
that because section 102(4)(H) increases the cost of pro-
viding ERISA benefits, creates administrative burdens in
existing ERISA plans, and subjects employers to conflict-
ing multistate laws, it has a “connection with” ERISA
benefit plans and is therefore superseded by ERISA. FMC
Corp. v. Holliday, 498 U.S. 52, 60, 111 S.Ct. 403, 408-09,
112 L.Ed.2d 356 (1990). We disagree.

Section 102(4)(H) is plainly distinguishable from the
District of Columbia statute at issue in Greater Washing-
ton. That statute compelled employers to provide an
ERISA type benefit for employees receiving workers’
compensation. Section 102(4)(H), by contrast, provides
that the value of an employee fringe benefit plan must be
considered in the calculation of an employee’s average
weekly wage for purposes of determining weekly
workers’ compensation benefits. Unlike the statute at
issue in Greater Washington, section 102(4)(H) has only
an indirect impact on ERISA-regulated benefit plans. In a
recent case the Supreme Court stated, “[a]n indirect eco-
nomic influence . . . does not bind plan administrators to
any particular choice and thus function as a regulation of

i

App. 7

an ERISA plan itself.” New York State Conf. of Blue
Cross, __ U.S. at __, 115 S.Ct. at 1679. Maine employers
are not compelled to provide or continue ERISA-type
benefits to injured employees, nor are they required to
modify their ERISA plans or maintain a separate adminis-
trative structure to comply with the Maine statute. See
Lawrence Paper Co. v. Gomez, 257 Kan. 932, 897 P.2d 134,
143 (1995) (Kansas statute permitting inclusion of fringe
benefits in employee’s average weekly wage is not pre-
empted by ERISA).

ERISA does not preempt state legislation that has a
tenuous, remote, or peripheral’ ” connection to ERISA
benefit plans. Greater Washington, 506 U.S. at 130 n. 1,
113 S.Ct. at 583 n. 1 (quoting Shaw v. Delta Air Lines, Inc.,
463 U.S. at 100, 103 S.Ct. at 2901). In Blue Cross the
Supreme Court stated, “[i]f ‘relate to’ were taken to
extend to the furthest stretch of its indeterminacy, then
for all practical purposes pre-emption would never run
its course, for ‘[rJeally, universally, relations stop
nowhere.’ ” New York State Conf. of Blue Cross, __ U.S.
at ___, 115 S.Ct. at 1677 (quoting H. James, RODERICK
HUDSON xli (New York ed. World’s Classics 1980)).
Moreover, ERISA does not shield plan administrators
from any and all possible economic influences that may
arise from state laws or regulations. Many traditional
areas of state regulation, such as the regulation of work-
place conditions or the formulation of quality standards
for hospital services, can affect the cost of an ERISA plan
but are not superseded by ERISA because they have only
an indirect effect on plan administration. Id. at __, 115
S.Ct. at 1679. The issue, for purposes of preemption, is
whether Congress intended to foreclose the states from

“da

App. 8

exercising regulatory authority in a given area. Id. at ____
115 S.Ct. at 1676. In cases “where federal law is said to
bar state action in fields of traditional state regulation,”
such as workers’ compensation legislation, there is an
“ ‘assumption that the historic police powers of the States
were not to be superseded by the Federal Act unless that
was the clear and manifest intent.’” Id. (quoting Rice v.
Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146,
1152, 91 L.Ed. 1447 (1947)).

Maine is not alone in permitting the consideration of
fringe benefits in an employee’s pre-injury wage.? “[T]he
purpose of calculating an average weekly wage is to
arrive at an estimate of the ‘employee’s future earning
capacity as fairly as possible.’” Nielsen v. Burnham &
Morrill, Inc., 600 A.2d 1111, 1112 (Me.1991) (quoting
Fowler v. First Nat’l Stores, Inc., 416 A.2d 1258, 1260
(Me.1980)). Statutes and judicial decisions that permit
consideration of fringe benefits in the determination of an
employee’s pre-injury wage are premised on the practical
reality that in some circumstances the money received in
an employee’s weekly pay envelope will not accurately
reflect the employee’s actual earning capacity. Ex Parte
Murray, 490 So.2d 1238, 1240-41 (Ala.1986); Ragland v.
Morrison-Knudsen Co., 724 P.2d 519, 522-23 (Alaska

2 See, e.g., ALA.CODE § 25-5-1(6) (1992), ALASKA STAT.
§§ 23.30.220, 265(15) (1990); COLO.REV.STAT. § 8-70-101
(Supp.1995); FLA.STAT.ANN. § 440.02(24) (West Supp.1993);
KAN.STAT.ANN. § 44-511(a)(2) (1993); MICH.COMP.LAWS
§ 418.371(2) (1985); Ebmer v. Wayne Village, 197 Mich.App. 307,
494 N.W.2d 842, 844 (1992); 2 A. Larson, THE LAW OF
WORKMEN’S COMPENSATION § 60.12(b) (1993).

App. 9

1986); Murphy v. Ampex Corp., 703 P.2d 632, 633-34
(Colo.App.1985).

We are not persuaded that Congress, by its enactment
of ERISA, intended to supersede state authority to calcu-
late weekly workers’ compensation benefits based on a
fair estimate of an employee's earning capacity by includ-
ing an employee’s fringe benefits. Our conclusion is but-
tressed by Congress’s express exemption of plans
maintained solely for the purpose of complying with
applicable state workers’ compensation laws from the
ERISA preemption provision. 29 U.S.C. §§ 1003(b)(3),
1144(a). Our result is also supported by decisions of the
federal courts that states are not precluded from referring
to ERISA benefits to calculate benefits for otherwise per-
missible purposes within the states’ traditional authority.
See, e.g., Thiokol Corp., Morton Int’l, Inc. v. Roberts, 76
F.3d 751, 755 (6th Cir.1996) (ERISA does not preempt
Michigan tax based in part on employer payments to
fringe benefit plans); Keystone Chapter, Associated
Builders & Contractors v. Foley, 37 F.3d 945, 963 (3d
Cir.1994), cert. denied, ___ ;U.S. __,, 115 S.Ct. 1393, 131
L.Ed.2d 244 (1995) (ERISA does not preempt statute
requiring public contractors to pay prevailing minimum
wage calculated with reference to employer contributions
to fringe benefit plans).

We reject Hannaford’s argument that by excluding
from the average weekly wage those fringe benefits that
“continue during the disability” the Legislature intended
a direct impact on ERISA plans by encouraging
employers to continue fringe benefits during the course
of an employee’s disability. The legislative record is
devoid of any reference to such an intent, and we do not

App. 10

find any evidence of that intent in the plain statutory
language. Had the Legislature intended to encourage
employers to continue benefits during the course of an
employee’s disability, it would have applied section
102(4)(H) across the board to all employees, as the Dis-
trict of Columbia had done with its statute in Greater
Washington, and not merely to those employees whose
weekly benefits are less than two-thirds of the state aver-
age weekly wage on the date of the injury.

We are not unmindful of the legislative history of this
issue following our 1989 decision in Ashby v. Rust Eng’g
Co., 559 A.2d 774, 775 (Me.1989), in which we held that
certain payments must be included in the average weekly
wage when employee benefits are paid for by bargained-
for, dollar-for-dollar deductions from an employee’s pay. :
Clark v. Rust Eng’g Co., 595 A.2d 416, 419 (Me.1991). See
also Fletcher v. Hanington Bros., Inc., 647 A.2d 800, 803
(Me.1994) (employee’s voluntary deductions from weekly
pay for health insurance must be included in average
weekly wage). The Legislature’s immediate response to
Ashby was the enactment of P.L.1991, ch. 615, § A-20;
which purported to overturn that decision and provided
that fringe benefits may not be included in an employee’s
average weekly wage. 39 M.R.S.A. § 2(2)(G) (Supp.1991),
repealed and replaced by Maine Workers’ Compensation
Act of 1992, P.L.1991, ch. 885, §§ A-7, A-8 (effective Janu-
ary 1, 1993); Tompkins v. Wade & Searway Constr. Corp.,
612 A.2d 874, 876 (Me.1992). In light of this recent history,
it is likely that the Legislature intended section 102(4)(H)
to strike a balance between the Ashby rule and the rule of
former section 2(2)(G) by providing a slightly greater

a a

App. 11

recovery to those employees with the lowest weekly ben-
efits.

We conclude that section 102(4)(H) has only a “ten-
uous, remote, or peripheral” connection with benefit
plans and is therefore not preempted by ERISA. Greater
Washington, 506 U.S. at 130 n. 1, 113 S.Ct. at 583 n. 1
(quoting Shaw v. Delta Air Lines, Inc., 463 U.S. at 100, 103
S.Ct. at 2901). Moreover, our decision is in accord with a
recent opinion of the Supreme Court of Kansas address-
ing a Kansas statute similar in all key respects to Maine’s
section 102(4)(H). Lawrence Paper, 897 P.2d at 143.

The entry is:

Decision of the Workers’ Compensation Board
affirmed.

All concurring.

681 A.2d 4

App. 12

STATE OF MAINE
WORKERS’ COMPENSATION BOARD
62 ELM STREET
PORTLAND, MAINE 04101

James MacAdam, Esq. John Lambert, Jr., Esq.
MCTEAGUE, HIGBEE, BLACK, LAMBERT,
LIBNER COFFIN
PO Box 5000 PO Box 15215
Topsham, Maine 04086 Portland, Maine 04101
WCB#: 93001313 DATED MAILED:
APR 19 1995

Within 5 days after issuing this decision, the hearing
officer may request that the full Workers’ Compensation
Board review the decision.

39-A M.R.S.A. §322(1) provides that any party in
interest may present a copy of this decision to the clerk of
the Law Court within 20 days after receipt of the notice of
the filing of this decision.

THERESA CIAMPI
(Employee)

VS.

HANNAFORD BROTHERS COMPANY
(Employer)
and

HANNAFORD BROTHERS COMPANY
(Insurer)

a

App. 13

Pending before the Board is the employee’s Petition
for Award. The parties have agreed that the only unre-
solved issue is the amount of the employee’s average
weekly wage which raises issues of what constitute fringe
benefits under §102(H) and whether that whole section is
pre-empted by ERISA, 29 USC §1001 et seq., a question
this hearing officer is without the jurisdiction to decide.

FINDINGS OF FACT

1. On January 30, 1993 when Theresa Ciampi suf-
fered a compensable injury at Hannaford Brothers her
average weekly wage, without fringe benefits, was
$389.30. Hannaford Brothers also made contributions for
Ms. Ciampi to the following: Social Security, Medical,
Dental, Disability, and Group Life Insurance, a retirement
plan and a 401(k) plan.

2. The value of those benefits except for the 401(k)
plan and the employer’s payments to social security,
which the employee seeks as a fringe benefit, amounts to
$62.54 per week; the value of the 401(k) plan is not
known.

3. The employers’ payments for fringe benefits did
not continue during the period of her disability; the
inclusion of these fringe benefits in her average weekly
wage would not result in that weekly benefit amount
being greater than two-thirds of the state average weekly
wage at the time of her injury.

App. 14

CONCLUSIONS OF LAW

1. The employer’s payments to social security are
not a fringe benefit; they are a tax which both the
employer and the employee must pay to the Federal
Government as long as the employee is working.

2. Asa tribunal of limited jurisdiction, the Workers’
Compensation Board cannot itself declare whether or not
§102(H) of the present Act is pre-empted by ERISA. This
general proposition of law is codified in §152(5) which
provides that this Hearing Officer may, “take action and
enter orders consistent with this Act...” This Hearing
Officer could not address the question of presumption
without exceeding those powers.

3. Ms. Ciampi’s fringe benefits fall within Tit. 39-A
§102(4)(H) they therefore must be included in her average
weekly wage.

WHEREFORE, the employee’s Petition for Award is
granted, the average weekly wage is established as
$451.84 plus the value of the 401(k) plan.

SO ORDERED.

Dated: April 19, 1995
Portland, Maine
WORKERS’ COMPENSATION BOARD

/s/ John McCur
JOHN MCCURRY, HEARING OFFICER

A true copy ATTEST

/s/ John J. Jolicoeur
WCB CLERK

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386018_1687%3A1. Public record. Not legal advice.