The Employee Retirement Income Security Act (ERISA) regulates employer-sponsored benefit programs and safeguards the rights and interests of employees participating in such plans. It establishes specific guidelines that provide essential protections by ensuring fairness, accountability and financial security for workers.
Below are some of ERISA’s protective measures you should be aware of if your employer provides workers with the opportunity to participate in a voluntarily-established employee retirement and health plan.
Equal access to benefits
ERISA mandates that benefit plans must be offered to all eligible employees who meet specific criteria. For instance, employees over 21 years and with a minimum of 12 months of service should have access to the benefit plan. This requirement prevents discriminatory practices and helps to ensure that employees are not unfairly excluded from valuable benefits.
Responsibility and accountability in the management of funds
Employers offering benefit programs have a fiduciary duty to act in the best interests of the plan participants. This includes managing funds with care and prudence. ERISA empowers the law to hold employers accountable and potentially subject them to prosecution if they fail to fulfill their fiduciary responsibilities. By enforcing responsible fund management, ERISA promotes transparency and accountability.
Protection against wrongful termination
ERISA prohibits employers from terminating employees solely to avoid providing them with benefits. This provision ensures that employees cannot be unfairly dismissed or discriminated against based on their participation in benefit plans. By safeguarding against wrongful termination, ERISA protects employees’ rights and prevents employers from exploiting their power to evade their obligations.
Guaranteeing payment and ensuring compliance
ERISA provides an additional layer of security for employees participating in benefit programs by guaranteeing that funds will be paid, even in unforeseen circumstances such as employer bankruptcy. The Pension Benefit Guaranty Corporation ensures participants receive their entitled benefits, offering financial stability and peace of mind.
Additionally, ERISA imposes reporting requirements on employers to better ensure compliance with the law. Regularly reporting and disclosing plan information enhance transparency and keep employees informed about their benefits. Non-compliance can result in civil and criminal penalties for fiduciaries, promoting adherence to the law and fostering accountability.
Protect your retirement future and legal rights
If you experience an ERISA violation or are concerned about your benefits, it is prudent to take proper steps to safeguard your interests. Seeking legal guidance can help you understand your rights and the options available to make things right.