Los Angeles Employment Lawyer

Employee Pension Benefits under ERISA

The Employee Retirement Income Security Act (ERISA) of 1974 is a law which protects the pensions and other organized retirement plans of employees of companies covered by the statute. Passed by Congress over three decades ago, ERISA has been amended and revised several times, though its initial purpose remains the same.

History of ERISA

The roots of ERISA began in a committee set up by President Kennedy in 1961 to examine corporate pension benefit plans, a sentiment echoed in Senator Jacob Javits’ proposal for legislation regulating the implementation and handling of pension plans. Specifically, Javits sought to provide more structure and accountability on pensions.

Though the legislation was initially opposed by both business interest groups and labor unions, who were worried that regulation would lead to a loss of flexibility, public opinion began to be swayed by a 1970 NBC special report on the consequences of unregulated, often underfunded pension plans. ERISA was signed into law in 1974.

ERISA as Employment Law

Though ERISA imposes strict regulations on both pension and employee healthcare benefits plans, it does not require employers to create or supply such plans; however, it does mandate that employers who choose to establish such plans to meet certain minimum standards and rules of conduct.

ERISA requires that companies with pension plans disclose important information to the government and to those with a stake in the plan. It also places a fiduciary duty on the managers of pension plans, obligating them to act in the best interests of the plan’s beneficiaries. Finally, ERISA protects pension funds and assures employees access to their retirement benefits by setting forth enforcement procedures and allowing employees to sue for their rightful benefits or over claims of a breath of fiduciary duty.

To learn more about how ERISA affects you, call Los Angeles, CA employment lawyer Perry Smith at 888-356-2529 today.