If you work in the private industry and have a pension plan, you have probably heard of ERISA. Despite its importance for workers and employers, many people do not become familiar with it until a less than ideal situation forces them to learn about it. Fortunately, there are resources that can be used to inform yourself before any unfortunate circumstances forces you to do so.
The Employee Retirement Income Security Act
According to The United States Department of Labor, The Employee Retirement Income Security Act (ERISA) is “a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.” It was signed into law in 1974 by President Gerald Ford in response to a many private industry employees not being given the pensions they were led to believe they would receive.
What does ERISA do?
Under ERISA, pension plans are required to give all participants information regarding the plan. It requires plan providers to give this information to participants promptly and in writing. This information can include,
· Minimum participation standards
· Financial information
· Benefit funding
· Fiduciary responsibilities
· Grievance and appeals processes
ERISA also ensures that workers will be provided with a summary of the plan automatically after they have been enrolled. Plan participants also have the right to sue the plan provider if benefits are not provided or there are breaches of the plan agreement.
What does ERISA not cover?
ERISA does not generally provide coverage for government employees. It also does not cover plans that are provided by churches or government agencies. It also does not cover plans from outside of the United States.
ERISA was initially created because people who had worked hard for many years for different companies and in different industries did not receive fair compensation when it came time to collect pensions. This left many people without jobs or the means to take care of themselves or their loved ones.
If you find yourself in a situation in which you may have an issue with pension being provided, or you think your pension plan provider has not fulfilled their legal obligations, you may have grounds for legal action. In these cases, it is suggested that you seek out the services of an experienced legal professional. They will be able to provide you with guidance and support as you get the resources you deserve.