What Is ERISA and How Can it Help You?
The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that was enacted to provide coverage for employees who participate in employee benefit plans and sets standards for how these plans are managed, giving employees important protections and making sure that plans are properly funded.
This important law provides comprehensive coverage for employees who participate in employee benefit plans and this article will look more closely at how ERISA can benefit you.
ERISA Requirements
ERISA requires employers to provide certain disclosures to employees about their benefits. For example, employers must provide a summary plan description (SPD) that explains the plan’s terms and what benefits employees can expect.Employers must also provide employees with an annual statement containing information about their benefits and the financial status of their plan. Additionally, the U.S.Department of Labor requires employers to file regular reports with information about the plan’s assets, contributions, and investments.
Protection Under ERISA
Outlined below are the key protections that ERISA provides employees:- The plan must be managed in a fiduciary capacity, requiring the administrators of the employee benefit plan to act in the best interests of the employees and their beneficiaries. If an employee thinks their benefits have been mishandled or wrongly denied, they have the right to sue for breach of fiduciary duty under ERISA.
- ERISA governs private long term disability employee benefit which prevents employers from engaging in certain activities as a way of avoiding paying long disability benefits. For example, an employer might be in violation of ERISA if they suspend an employee’s benefits or duties after they make a claim or if they expect a claim to be made, or impose a fine on an employee for claiming their benefits. Proving an ERISA violation can be a complex process, and it is inadvisable to pursue a claim on your own. The presence of an experienced attorney such as an ERISA lawyer New York can greatly increase your chances of successfully proving a violation of your long term disability benefits.
- ERISA ensures that employee benefit plans are properly funded by requiring employers to put enough money into employee benefit plans so that they are financially sound and able to pay benefits when they are due. Employers must also provide participants with information about the funding status of their plan so they can make informed decisions about their benefits.
- ERISA also provides some protections for employers. If an employer follows ERISA’s requirements, they are protected from state law claims related to employee benefits. For example, an employee cannot sue their employer for breach of contract or negligence under state law if the employer has an employee benefit plan in place that is in compliance with ERISA’s standards.
By protecting the rights of employees and providing basic protections for employee benefits, ERISA helps ensure that employees can receive the benefits they have earned and are entitled to.
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Posted - 02/13/2023
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