A May 2017 decision of the Federal Court for the Middle District of Florida should provide an impetus for employers with employer-sponsored retirement plans to reevaluate their beneficiary designation forms and for their employees to reexamine such forms to ensure compliance with their employer's requirements. The decision in Ruiz v. Publix Super Market (Case No. 8:17-cv-735-T-24 TGW) demonstrates the need for employers to provide precise instructions as to how an employee-participant can designate his or her beneficiaries under an employer-provided benefits plan if he or she is to die prior to receiving full benefits.

Instructions, Missteps, Consequences

In Ruiz v. Publix Super Markets, the decedent, Irialeth Rizo, participated in an employee stock ownership plan (ESOP) and a 401(k) plan through her employer, Publix Super Markets, before dying of cancer. In 2008, Rizo had named her nieces and nephew as the beneficiaries under both of her plans. However, by 2015, Rizo had a change of heart after her cancer had progressed. She now wished to name her significant other, the plaintiff Arlene Ruiz, as the beneficiary under both of her accounts.

Publix's summary plan descriptions for its ESOP and the 401(k) plan contained explicit instructions for changing a plan beneficiary designation. Both plans contained the following directive for doing so: