Self Insured Short Term Disability - subject to nondiscrimination rules?

[mariemonroe]

Can an employer which fully insures a short term disability plan only offer the plan to certain employees (for example, physicians) or is there some nondiscrimination rule which would require it to offer the plan to all employees?

I see that Labor Reg. § 2510.3-1(b)(2) provides that “employee welfare benefit plan” and “welfare plan” shall not include—

...Payment of an employee's normal compensation, out of the employer's general assets, on account of periods of time during which the employee is physically or mentally unable to perform his or her duties, or is otherwise absent for medical reasons (such as pregnancy, a physical examination or psychiatric treatment)...

Does this mean that such a plan is not subject to ERISA?

What if the short term disability plan in my example doesn't pay the employee's "normal compensation" but a % of such employee's compensation?