§ 4.3.5.1.4 THE EMPLOYEE REQUIREMENT.

• Jurisdiction: Arizona

§ 4.3.5.1.4 The Employee Requirement. Intrinsic to the concept of an employee benefit plan is the existence of "employees" who benefit from the program. If none of the individuals who are covered under the plan is an employee, the program or policy cannot, by definition, be an employee benefit plan.⁴³ An individual is an employee if he or she is "employed by an employer."⁴⁴

Prior to 1992, there was a significant split among the circuits on the definition of an employee for ERISA purposes. The majority of courts applied a rule derived from common law and the Restatement of Agency to delineate between employees and independent contractors.⁴⁵ The Fourth Circuit adopted a different approach based on an examination of whether the individual in question was within the class of those that Congress sought to protect when it enacted ERISA.⁴⁶ This issue was resolved in 1992 when the...