01/17/2007
Victory for NFIB's Legal Foundation
Contact: Melissa Sharp, (202) 554-9000
WASHINGTON, D.C.--The National Federation of Independent Business today praised a ruling by a federal appeals court that invalidated Maryland's Fair Share Health Care legislation, which required large employers to increase spending for employee health care. The appeals court upheld the decision issued in July 2006 by a district court judge that found the law in violation of the Employee Retirement Income Security Act.
"This is great news," said Ellen Valentino, Maryland state director of the National Federation of Independent Business. "We believe the real aim of this legislation was to establish a precedent that would ultimately subject Maryland small-business owners to a payroll tax and require all Maryland small-business owners to pay for health insurance for full-time and part-time employees. In fact, many of the groups that supported the Fair Share bill also supported legislation that would require all small businesses to provide health insurance to their workers. Our members tell us they would like to provide insurance, but they can't afford it."
NFIB's Legal Foundation filed an amicus brief in the case, brought by the Retail Industry Leaders Association, asking the United States Court of Appeals for the Fourth Circuit to affirm the district court's ruling invalidating the law because it is preempted by the Employee Retirement Income Security Act, which governs standards for private health and pension plans. The Supreme Court has repeatedly said states may not attempt to compel a certain level of employee benefits, nor may states pass laws that interfere with the uniform national administration of benefit plans.
"We are very pleased the court found Maryland's law to be in violation of ERISA," said Elizabeth Gaudio, senior executive counsel of NFIB's Legal Foundation. "This has always been about forcing small-business owners to provide health insurance. Unfortunately, the law did nothing to address the issue of access to affordable health care. Businesses that do not provide insurance do so for a reason; they can't afford to buy health insurance. Passing burdensome legislation that violates federal statutes is not going to fix the health-care crisis in Maryland or anywhere in this country."
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The NFIB Legal Foundation is a 501(c)(3) organization created to protect the rights of America's small-business owners by providing advisory material on legal issues and by ensuring that the voice of small business is heard in the nation's courts. The National Federation of Independent Business represents the consensus views of its members in Washington and all 50 state capitals.
