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Explaining the Employee Retirement Income Security Act

On Behalf of | Apr 11, 2018 | Workers' Compensation

If you have signed a contract for employment, have read employment law or have read employment posters hung in the workplace, you have likely come across the word ERISA. You might be wondering what ERISA stands for and why it is so important. ERISA is short for the Employment Retirement Income Security Act, which was passed in 1974. Let’s take a deeper look at ERISA in today’s post.

The law was created to protect individuals who are enrolled in various health and pension plans in the private industries across the country. The law set the minimum standards for these pension and health plans that are voluntarily created by employers. ERISA requires the following of employers:

  • Sets the minimum standards for employees to participate
  • Provide employees with plan information regarding funding and features
  • Information about vesting
  • Information about how benefits accrue
  • Establish a plan for individuals to file grievances and appeals
  • Allows participants the right to sue for breach of fiduciary duty and for benefits
  • Created the Pension Benefit Guaranty Corporation
  • Names the fiduciary duties for those who are responsible for managing these benefit and pension plans

On the flip side of things, ERISA does not govern the following pensions or benefit plans:

  • Employees of churches
  • Any plan maintained or created by a government entity
  • Plans created that comply with disability laws, workers’ compensation laws or unemployment laws
  • Unfunded excess benefit plans
  • Plans that are maintained outside the country for nonresident aliens

Now that you know a little bit more about ERISA, you can ensure that you are protected as active employee in Covington, Louisiana.