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Employee Benefits Security Administration
DOL > EBSA > Laws & Regulations > Advisory Opinion

Advisory Opinion

April 25, 2003

Donald J. Siegel, Esq.
Elizabeth A. Sloane, Esq.
Segal, Roitman & Coleman
11 Beacon Street, Suite 500
Boston, MA 02108

2003-06A
ERISA Sec. 3(1)

Dear Mr. Siegel and Ms. Sloane:

This is in reply to your request for an advisory opinion regarding the applicability of Title I of the Employee Retirement Income Security Act of 1974, as amended (ERISA). Specifically, you ask whether the Labor Management Construction Safety Alliance, Inc. (LMCSA) is an “employee welfare benefit plan” within the meaning of section 3(1) of Title I of ERISA.

You state that LMCSA was established in 1998 as a non-stock, non-profit corporation under the laws of the Commonwealth of Massachusetts. LMCSA’s Articles of Organization state that it is intended to be a labor-management cooperative organization under section 302(c)(9) of the Labor Management Relations Act (LMRA) and under section 6 of the Labor Management Cooperation Act of 1978. Membership in LMCSA is open to state and local building trades councils and their affiliated local unions (Unions), employers engaged in work that is within the jurisdiction of a local union affiliated with such councils and signatory to a collective bargaining agreement with such local union (Employers), trade associations representing such employers (Associations), and such other organizations or individuals having a mutual interest in advancing LMCSA’s purposes including, but not limited to, construction users, industry coalitions, industry promotion funds, joint labor management trust funds, federal, state or local government agencies, insurance companies and other providers of support services to the area construction industry, and research institutions.

The activities and affairs of LMCSA are managed by a board of directors (Board) who are empowered to appoint, hire or contract with an executive director to perform such administrative and managerial duties and responsibilities, with respect to LMCSA, as the Board may consider necessary or appropriate. According to Article IV of LMCSA’s By-Laws, the Board shall be comprised of no less than sixteen directors, and shall have equal numbers of Union directors and Employer/Association directors. LMCSA is supported by grants from government and private foundations, including the Federal Mediation and Conciliation Service, membership dues, revenues generated from seminars and programs sponsored by LMCSA, and donations from industry promotion funds and other labor-management funds.

LMCSA’s purposes are stated in section 2.02(c) of its Articles of Organization. Those purposes are to:

  • Improve communications between representatives of labor and management and to provide a forum for discussion of occupational safety and health matters of mutual concern;

  • Promote the health and safety of individuals employed in the construction industry and their families, as well as the health and safety of the public affected by the area construction industry;

  • Conduct research, perform studies, collect information, develop procedures and otherwise act to minimize hazards in the construction industry and to improve the competitiveness of employers in the area construction industry;

  • Promote the establishment and maintenance of quality safety and health education programs for individuals employed or to be employed in the area construction industry;

  • Establish and maintain mechanisms for monitoring and enforcing compliance with federal, state and local laws, rules, regulations and standards governing safety and health in the area construction industry;

  • Communicate with the public about safety and health issues of concern to the area construction industry;

  • Establish standards for safety and health practices within the area construction industry;

  • Study and otherwise facilitate resolution of safety and health problems and matters affecting the area construction industry;

  • Cooperate with other organizations, trusts, programs and groups to advance mutual interests relating to the area construction industry;

  • Cooperate with and support, financially and otherwise, other labor-management cooperative committees for one or more of the purposes listed in LMCSA’s Articles of Organization;

  • Encourage free collective bargaining between the affiliates of the Massachusetts Building Trades Council (Council) and employers engaged in work coming within the jurisdiction of local unions affiliated with the Council;

  • Solicit and otherwise raise funds to finance LMCSA’s activities from any and all lawful sources, including employers, unions and their members, employee benefit plans, labor-management cooperation organizations, private foundations, and federal, state and local governments; and

  • Otherwise implement the purposes and provisions of the Labor-Management Cooperation Act of 1978.

LMCSA’s activities include conducting safety and health education outreach programs. Individuals who have received training at the National Resource Center for OSHA Training lead these programs for union workers and management personnel in the construction industry. The programs range from ten to thirty hours in length. You represent that LMCSA’s health and safety educational programs do not include job training or apprenticeship benefits, but rather are limited to providing workers with information about how to avoid jobsite dangers and workplace accidents. The education outreach programs focus on safety and health awareness topics required and recommended by OSHA. The programs include, for example, sessions on “Introduction to OSHA,” “Tool Safety,” “Electrical Safety,” “Scaffold Safety,” “Hazard Communication,” “Materials Handling,” and “Fall Protection.”

You also represent that the provision in section 2.02(c) of LMCSA’s Articles of Organization, on soliciting and raising funds to finance LMCSA’s activities, will be amended to eliminate the reference to “employee benefit plans.” In addition, you represent that LMCSA will not accept any funds from employee benefit plans covered by Title I of ERISA.

You further represent that, although LMCSA’s Articles of Organization and By-Laws provide the Board with broad operational authority, for example, “to take any and all actions as in its judgement are necessary or convenient to effectuate the purposes of [LMCSA],” LMCSA was not established for the purpose of providing any benefit described in section 3(1) of ERISA, and there is no provision in the Articles of Organization or By-Laws that LMCSA intends to use as a basis for providing any benefits described in section 3(1) of ERISA. You also advised that LMCSA is not requesting an advisory opinion on whether the provision of employee benefits, such as through a group health plan, to LMCSA’s own employees is an employee benefit plan within the meaning of section 3(3) of ERISA.

Section 3(1) of Title I of ERISA defines the term "employee welfare benefit plan" to include:

[A]ny plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment, or vacation benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services, or (B) any benefit described in section 302(c) of the Labor Management Relations Act, 1947 (other than pensions on retirement or death, and insurance to provide such pensions).

Based on the information and representations provided, it does not appear that LMCSA provides any benefit included in section 3(1)(A). We note, in particular, that the safety awareness seminars LMCSA sponsors do not appear to provide training specific to a particular job or skill. Because, and to the extent that, the LMCSA safety programs are limited to communicating safety awareness information about how to avoid jobsite dangers and workplace accidents, and are not related to specific job skills, it is the position of the Department that LMCSA will not provide apprenticeship and training benefits or any other “benefit” to participants or their beneficiaries within the meaning of section 3(1)(A).

Further, it does not appear that LMCSA provides any benefit included in section 3(1)(B). It is the Department's position that section 3(1)(B) of ERISA does not incorporate as a covered benefit every arrangement described in section 302(c) of LMRA. The Department clarified the definition of an “employee welfare benefit plan,” in 29 C.F.R. § 2510.3-1(a)(3), with regard to benefits described in section 302(c) of LMRA, by stating:

Section 302(c) of the LMRA lists exceptions to the restrictions contained in subsections (a) and (b) of that section on payments and loans made by an employer to individuals and groups representing employees of the employer. Of these exceptions, only those contained in paragraphs (5), (6), (7) and (8) describe benefits provided through employee benefit plans. Moreover, only paragraph (6) describes benefits not described in section 3(1)(A) of the Act. The benefits described in section 302(c)(6) of the LMRA but not in section 3(1)(A) of the Act are “ . . . holiday, severance or similar benefits.” Thus, the effect of section 3(1)(B) of the Act is to include within the definition of “welfare plan” those plans which provide holiday and severance benefits, and benefits which are similar (for example, benefits which are in substance severance benefits, although not so characterized).

Although this regulation was adopted prior to the amendment of section 302(c) of LMRA that added subsection 302(c)(9), the principle it articulates remains fully applicable. Only those arrangements described in section 302(c) of LMRA that provide benefits to participants or their beneficiaries would constitute employee welfare benefit plans.

Accordingly, on the basis of the information submitted and assuming adoption of the aforementioned amendments to the LMCSA’s Articles of Organization, it is the position of the Department that LMCSA would not be an employee benefit plan covered under Title I of ERISA.(1)  The absence of any explicit limitation in the Articles of Organization and By-Laws that would prevent LMCSA from providing welfare or pension benefits to participants or beneficiaries precludes us from assuring you that LMCSA will not be an employee benefit plan if, as is apparently permitted under the above noted grant of broad authority in the articles and by-laws, it is operated so as to provide a benefit within the meaning of Title I of ERISA.

This letter constitutes an advisory opinion under ERISA Procedure 76-1. Accordingly, it is issued subject to the provisions of that procedure, including section 10 thereof relating to the effect of advisory opinions.

Sincerely,
John J. Canary
Chief, Division of Coverage, Reporting and Disclosure
Office of Regulations and Interpretations

Footnotes

  1. There is no indication in the submission that LMCSA is an employee pension benefit plan within the meaning of section 3(2) of Title I of ERISA.