See Archives

San Francisco Health care Security Ordinance UPDATE (3)

San Francisco Employer Spending Mandate Ruled Enforceable
9th District Court Grants Stay of Lower Court Decision Pending Appeal

Employer requirements under the San Francisco Health Care Security Ordinance are back in effect. The Court of Appeals for the 9th District on January 9th granted a stay of the lower District Court ruling that originally struck down the employer requirements. Due to the Appeals Court’s stay, the City ordinance is now in effect and, technically, compliance commenced on January 1, 2008. There is at least one additional step in the judicial process that could impact the enforceability of the ordinance but that formal appeal hearing is not expected to take place sooner than April or May 2008.

In the January 9th ruling, the appeals court justified its decision by ruling that the City had successfully shown:

1. There is a high probability that, in the upcoming hearings, the court will agree that the Ordinance is not pre-empted by ERISA. 

2. The hardships imposed on employers were significantly less than those imposed on the City in the interim.

3. The general public interest was strongly in favor of the City.

Due to this ruling employers will have to comply with the spending and reporting requirements under the Ordinance. At this time we recommend that employers wait a few days to determine whether the City will announce any delay or changes in the timing or terms of the compliance requirements. Absent any compliance relief, we advocate that employers consider moving forward with the compliance strategy as outlined in Insight Volume 11, Issue 7 (December 2007).

Timeline:

This document is not intended to provide any legal advice or analysis. Please consult your own legal counsel for further information on the topics discussed in this issue of Insight.