Accidents and illnesses that are severe enough to trigger a long-term disability (“LTD”) claim commonly lead to another development: involuntary employment termination. Federal law, in particular the Family and Medical Leave Act of 1993, affords a level of job protection, but it’s not universally applicable (companies with fewer than 50 employees are exempt) and, in any event, the rights that it affords are not without limits.
Employment termination (whether voluntary or involuntary) in and of itself poses no challenge for an LTD claimant; as long as disability began while the claimant was “actively at work,” and provided that the claim is submitted on a timely basis, a subsequent change in one’s status from employed to terminated should be of no moment. So if that’s the case then what’s the problem?
The problem is that sometimes when an employee is asked to leave, particularly when severance benefits are in the picture, he or she will be handed a separation agreement that spells out the terms under which the parties shall endeavor to amicably part ways. And almost invariably, buried somewhere deep in the agreement, there will appear a broad and binding release of all claims against the employer and (typically) its subsidiaries and affiliated and related entities.
When Kim Keister, a stroke victim whose claim for LTD benefits was denied, was asked by his employer (AARP) to sign such an agreement, he had no idea that by doing so he would be foreclosed from bringing an ERISA lawsuit against the AARP Benefits Committee (plan administrator of AARP’s LTD plan). Unfortunately for him, however, that’s exactly what happened. Deeming the agreement broad enough to cover not only AARP but also the AARP Benefits Committee, and comprehensive enough to cover his ERISA claim, Judge Ketanji Brown Jackson of the United States District Court for the District of Columbia dismissed Mr. Keister’s case.
As should be evident from Mr. Keister’s experience, if you’re a disability claimant whose been asked to sign an employment separation agreement, the need to consult with an experienced ERISA attorney cannot be overstated . . . lest you run the risk of ending up on the wrong side of the courthouse door, sitting on your keister.
Keister v. AARP Benefits Committee, 410 F. Supp. 3d 244 (D.D.C. 2019)