Voluntary benefits lawsuits turn employer Form 5500 data into evidence

A wave of proposed class actions under the Employee Retirement Income Security Act (ERISA) is targeting employers over voluntary benefits their workers pay for themselves, such as accident, critical illness and hospital indemnity insurance. The suits, which started in December 2025, claim employers failed to monitor the broker commissions built into those premiums. United Airlines, Allied Universal and Banner Health are among the employers named, along with several major benefits brokers.

Plaintiffs are relying on arguments developed over years of 401(k) fee litigation, including breach of the duties of prudence and loyalty, failure to monitor and prohibited transactions, according to Sarah Sise, who leads Quarles & Brady’s employee benefits team in St. Louis, Missouri, and Lauren Schuster, a partner in the firm’s St. Louis office. The complaints say the employers, as fiduciaries, never assessed whether compensation, premiums and the value employees received remained reasonable. High commissions are offered as evidence of that failure.

What the voluntary benefits complaints allege

Pimm v. United Airlines alleges Mercer received more than $14 million in commissions from 2020 to 2024, about 36 percent of premiums on average, while the products’ historical loss ratio was well under 50 percent. In Fellows v. Allied Universal, plaintiffs allege Mercer and Lockton received about $23 million, an average of 39.8 percent. They contrast that with public filings showing commissions of about 10 percent or lower for some comparable large plans.