The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that was passed to protect pension rights of workers in private industry. It covers most employee benefit plans, including disability, life, and medical insurance and pension benefits provided by an employer.
Nowhere in the provisions of the ERISA law that has it required an employer to establish a pension plan. It only requires that those who establish plans must meet certain minimum standards.
Standards such as,
1. Regularly providing participants with full and clear information about the plan including information about plan features, funding and how and when pension benefits can be collected.
2. Sets minimum standards for participation for pension plans, vesting, benefit accrual and funding.
3. Provide accountability of plan fiduciaries, especially in cases of breach.
4. ERISA law also mandates that a grievances and compliant department be established for plan participants.
ERISA Law also gives participants the right to sue for benefits, breaches of fiduciary duty and those who are waging prohibited actions under ERISA law.
The aforementioned are the protective measures that the ERISA law extends to the workers in general.
On this line, a question would be relevant, Is ERISA law sufficient in protecting working person’s rights. Put is differently, does it effectively cure the end it intends to achieve, which is protecting worker’s pension rights?
To note, ERISA law had replaced all state laws that protected an employee's rights to benefits from an insurance company or employee trust.
The effect had greatly affected vast majority of pension claimants. The changes had made the ERISA law takes precedence over state laws.
One has said that ERISA law has reduced rather than expanded the legal protections available to policyholders.
State law provides a higher level of protection to employees compared to ERISA, in cases of unjust denials of pension benefits
.
Various State laws provide an employee the right to jury trial and could receive constitutive damages aside from the benefits under the policy. In contrast, ERISA law there is no right to a jury trial.
On this score alone, a safe generalization can conclude that ERISA law provides legal obstacle rather than protection.
Having this law prevailed in our jurisdiction, we can do nothing except to accede to its mandate despite the pitfalls it brings.
Claimants having varied concern on this issue must settle with a lawyer who is adeptly knowledgeable with this law. The lawyer can be utilized give them the much-desired protection and at least level their playing field and made a fair chance on their claims.
