Are Workers\u27 Compensation \u27Alternative Benefit Plans\u27 Authorized by State Opt out Schemes Covered by ERISA?

There is continuing interest by employers in providing workers compensation benefits through ERISAgoverned employee benefit plans States have authority under Shaw v Delta Airlines SCt 1983 to allow employers to comply with state workers compensation laws through use of alternative ERISAgoverned employee multibenefit plans This is a judicallycreated exception to Section 514a of ERISA ÔÇò the statutes sweeping field preemption provision But what if a state allowed compliance with its workers compensation law by creating a law ÔÇò an optout law ÔÇò that in essence said employers did not have to comply with its workers compensation law Is such a noncompliance law a workers compensation law of the type contemplated by the Court in Shaw or by Congress in attempting to save workers compensation laws from preemption under Section 4b3 and Section 514a of ERISA Herein I argue that it is not Although the Oklahoma Supreme Court has recently struck that states opt out law on state constitutional special law grounds ÔÇò a surprising enough result since it is questionable whether the state courts had jurisdiction over a controversy concerning a plan created by a law that was likely facially preempted by ERISA ÔÇò I doubt we have seen the last of optout given dissimilarities in state constitutions and the corresponding likelihood that an optout law would be upheld on state constitutional grounds bringing the ERISA questions frontandcente