ERISA-First Circuit Rules That An Issue of ERISA Preemption Should Be Decided By An Arbitrator

In Prime Healthcare Services-Landmark LLC, No. 16-1161(1st 2017), the First Circuit Court of Appeals (the “Court”) had to decide whether a dispute between employees and their successor employer- relating to an alleged violation of the applicable collective bargaining agreement by changing the terms of, and ceasing contributions to, a defined benefit plan- should be resolved in arbitration or in the courts. The parties agreed to arbitrate this dispute. The district court, however, refused to compel arbitration; it found that ERISA preempted arbitration of this dispute, and reasoned that this, in turn, presented an issue of arbitrability properly decided by a judge, not an arbitrator. The Court found that the issue of ERISA preemption in this case is not an issue of arbitrability, but rather one that is squarely for the arbitrator to decide, and therefore reversed the district court’s ruling.

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