What is ERISA?
Employees often see the name “ERISA” appearing around discussions involving pensions, insurance, and other benefits provided by their employers. This federal law, the Employee Retirement Income Security Act of 1974, is designed to protect workers who rely on benefits promised as a condition of employment. Because of the complexity of ERISA provisions, employees often find it to their advantage to work with an experienced ERISA lawyer when handling benefits disputes.
ERISA applies to a number of benefits offered by employers. These laws do not require employers to provide benefits, such as pension plans. However, recognizing that employees often decide to accept or continue working in a position because of promised benefits, ERISA establishes requirements for these benefits to protect employees.
What is ERISA and what does it cover? ERISA sets standards for most employers’ retirement and health plans. Among other things, ERISA:
- Establishes fiduciary duties for those who manage plans and plan assets
- Sets standards for vesting, accrual of benefits, funding, and participation
- Requires plans to have a procedure for airing grievances and appealing denial of plan benefits
- Gives employees the right to sue for breach of fiduciary duty
- Gives employees the right to sue if benefits are denied
- Guarantees payments when defined benefit plans are terminated
While ERISA protections apply to most employee benefit plans, they generally do not apply to benefits offered by governments, churches, or plans outside the U.S. for nonresident aliens. In addition, ERISA does not apply to plans set up only to comply with unemployment or workers’ compensation requirements.
How Employees May Enforce Their Rights Under ERISA
While ERISA grants employees the right to file a lawsuit in federal court, in many cases, they must first exhaust available administrative remedies. For instance, if an employee is denied long-term disability benefits, the worker must take intermediate steps before taking the claim to court. ERISA establishes requirements for reconsiderations of claim denials and requires an insurer to make a decision within 45 days after receiving an appeal.
To understand what ERISA is and how it can help an employee, an ERISA attorney could explain how to proceed in a particular case to take advantage of ERISA protections. In many situations, ERISA establishes time limits for taking action, so it is critical to adhere to all applicable deadlines.
It is also important to submit evidence at the appropriate time. Even though ERISA allows claimants to file a lawsuit for benefits, for instance, they may be limited to basing the action on evidence previously submitted during administrative proceedings.
Seek Assistance With Your ERISA Claims
ERISA is a complex set of laws. To take full advantage of the opportunities provided by these laws, it is a good idea to consult an attorney who is familiar with ERISA claims.
If you feel your pension plan is mismanaged, or if you have been denied healthcare benefits promised under an employee benefit plan, ERISA remedies could help you resolve the problems and move forward. However, it is necessary to understand what ERISA is and how to make the most of the protections provided under the statute in order to achieve positive results.