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CENTRAL ISLIP, N.Y.A federal court has invalidated the two-year-old Suffolk County, N.Y., play-or-pay health care mandate that requires certain retailers to provide a prescribed level of health insurance to their nonmanagement workers.
The Suffolk County law is pre-empted by the federal Employee Retirement Income Security Act, which bars states from legislating the content of employee benefit plans, Judge Arthur Spatt of the U.S. District Court in Central Islip, N.Y., ruled last Monday.
The ruling comes in a lawsuit filed in February 2006 by the Arlington, Va.-based Retail Industry Leaders Assn., which also successfully challenged a similar law enacted last year in Maryland.
"This court relied in part on the trial and appellate court decisions concerning Maryland's law, as well as on longstanding Supreme Court precedent to determine that despite some differences from the Maryland law, Suffolk County's law is also pre-empted by ERISA," Stephen Cannon, outside general counsel to RILA, said in a statement issued by the organization.
Maryland's law, enacted in 2006, would have required employers with 10,000 or more employees to spend at least 8% of payroll on health care for their employees or pay an equivalent tax.
Suffolk County's law, enacted in 2005 and amended in 2006, would have required large retail stores selling groceries in the community to make health care expenditures for most nonmanagerial, full-time, part-time and seasonal employees equivalent to a "public health cost rate" to be determined by the county.
Calls to Suffolk County officials were not returned.
Retail Industry Leaders Assn. vs. Suffolk County, et al., U.S. District Court for the Eastern District of New York, Central Islip, N.Y., Case No. 06 CV 00531, July 14, 2007.