Employee Retirement Income Security Act

• Author: Jeffrey Lehman, Shirelle Phelps

Page 126

The Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.A. § 1001 et seq. (1974), is a federal law that sets minimum standards for most voluntarily established PENSION and health plans in private industry to provide protection for individuals enrolled in these plans. ERISA regulates the financing, vesting, and administration of pension plans for workers in private business and industry. The 1974 enactment of ERISA by Congress was intended to preserve and protect the rights of employees to their pensions upon retirement by establishing statutory requirements that govern such matters.

ERISA requires retirement plans to provide participants with information including important details about plan features and funding. ERISA also describes fiduciary responsibilities for those who manage and control plan assets, requires plans to establish a grievance and appeals process for participants seeking benefits from their plans, and gives participants the right to sue for benefits and breaches of fiduciary duty. A number of amendments to ERISA expand the protections that are available to health-benefit-plan participants and beneficiaries. One important amendment, the Consolidated Omnibus Budget Reconciliation Act (COBRA), 29 U.S.C. §§ 1161?1168 (1994), provides some workers and their families with the right to continue their health coverage for a limited time after certain life events, such as the loss of a job. Another amendment to ERISA, the Health Insurance Portability and Accountability Act (HIPAA), 29 U.S.C. §§ 1181?1182, provides important new...