U.S. Supreme Court
Fort Halifax Packing v. Coyne, 482 U.S. 1 (1987)
Fort Halifax Packing Co., Inc. v. Coyne
Argued March 24, 1987
Decided June 1, 1987
482 U.S. 1
After appellant closed its poultry packaging and processing plant and laid off most of the employees who worked there, the Director of Maine's Bureau of Labor Standards filed suit to enforce the provisions of a state statute requiring employers, in the event of a plant closing, to provide a one-time severance payment to employees not covered by an express contract providing for severance pay. The State Superior Court granted the Director summary judgment, holding appellant liable under the statute, and the State Supreme Court affirmed, rejecting appellant's contentions that the state statute was preempted by the Employee Retirement Income Security Act of 1974 (ERISA) and by the National Labor Relations Act (NLRA).
1. The Maine severance pay statute is not preempted by ERISA, since it does not "relate to any employee benefit plan" under that statute's preemption provision, 29 U.S.C. § 1144(a). Appellant's contention that any state law pertaining to a type of employee benefit listed in ERISA, such as severance pay, necessarily regulates an employee benefit plan, and is therefore preempted, fails in light of the plain meaning and underlying purpose of § 1144(a) and the overall objectives of ERISA itself. Pp. 482 U. S. 7-19.
(a) Section 1144(a) does not refer to state laws relating simply to "employee benefits," but expressly states that state laws are superseded chanroblesvirtualawlibrary
insofar as they "relate to any employee benefit plan" (emphasis added). In fact, ERISA uses the words "benefit" and "plan" separately throughout the statute, and nowhere treats them as equivalent. Given the basic difference between the two concepts, Congress' choice of language is significant in its preemption of only the latter, which cannot be read out of ERISA. In order to be preempted, a state statute must have some connection with, or reference to, a plan. Pp. 482 U. S. 7-8.
(b) Premption of the Maine statute would not further the purpose of ERISA preemption, which is to allow plans to adopt a uniform scheme for coordinating complex administrative activities, unaffected by conflicting regulatory requirements in differing States. The Maine statute neither establishes, nor requires an employer to maintain, a plan that would embody a set of administrative practices vulnerable to the burden imposed by a patchwork, multistate regulatory scheme. In fact, the theoretical possibility of a one-time, lump-sum severance payment triggered by a single event requires no administrative scheme whatsoever to meet the employer's statutory obligation. Pp. 482 U. S. 8-15.
(c) Similarly, the Maine statute does not implicate the regulatory concerns of ERISA itself, which was enacted to ensure administrative integrity in the operation of plans by preventing potential fiduciary abuse. The Maine statute neither establishes a plan nor generates any administrative activity capable of being abused. Pp. 482 U. S. 15-16.
(d) Appellant's contention that failure to preempt the Maine statute will allow employers to circumvent ERISA, by persuading States to require types of plans the employers would otherwise have established on their own, has no force with respect to a state statute that, as here, does not establish a plan, generates no ERISA-covered program activity, presents no risk that otherwise applicable federal requirements will be evaded by an employer or dislodged by a State, and creates no prospect that an employer will face difficulty in operating a unified administrative benefit payment scheme. Holland v. Burlington Industries, Inc., 772 F.2d 1140, summarily aff'd, 477 U.S. 901, and Gilbert v. Burlington Industries, Inc., 765 F.2d 320, summarily aff'd, 477 U.S. 901, distinguished. Pp. 482 U. S. 16-19.
(e) Where, as here, a state statute creates no danger of conflict with a federal statute, there is no reason to disable it from attempting to address uniquely local social and economic problems. P. 482 U. S. 19.
2. The Maine severance pay statute is not preempted by the NLRA. Appellant's argument that the statute's establishment of a minimum labor standard impermissibly intrudes upon the collective bargaining process was rejected in Metropolitan Life Ins. Co. v. Massachusetts, 471 U. S. 724, and is without merit here. Although the statute does chanroblesvirtualawlibrary
give employees something for which they might otherwise have had to bargain, that is true of any state law that substantively regulates employment conditions. Moreover, appellant's argument that this case is distinguishable from Metropolitan Life because the statutory obligation at issue here is optional, in that it applies only in the absence of an agreement between employer and employees, is not persuasive, since, in fact, the parties' freedom to devise their own severance pay arrangements strengthens the case that the statute works no intrusion on collective bargaining. Thus, the statute is a valid and unexceptional exercise of the State's police power, and is compatible with the NLRA. Pp. 482 U. S. 19-22.
510 A.2d 1054, affirmed.
BRENNAN, J., delivered the opinion of the Court, in which MARSHALL, BLACKMUN, POWELL, and STEVENS, JJ., joined. WHITE, J., filed a dissenting opinion, in which REHNQUIST, C.J.,and O'CONNOR and SCALIA, JJ., joined, post p. 482 U. S. 23.