Martin D. Haverly, Attorney at Law
302-529-0121

ERISA and employees everywhere to celebrate a birthday

This September will mark 45 years since the Employee Retirement Income Security Act was made federal law. Before ERISA, employers weren’t bound by many rules for promises to employees about retirement plans, and they could break those promises almost with impunity.

If you’re employed by a private, for-profit business, ERISA’s anniversary is reason to celebrate. It’s also a good time to review what it does for employees and what it can do to violators who break the landmark law.

ERISA protects employees of certain kinds of employers

ERISA regulates the health and retirement benefits your private, for-profit company provides. The regulations set baseline standards and prohibit your employer and its plan provider from violating your rights as they manage those plans. ERISA also establishes the possible consequences for violators.

Although government, publicly funded and non-profit organizations are generally also bound by various federal and state protections for employees, ERISA itself does not regulate them.

Requirements that may sound familiar

If you’ve thoroughly read your retirement or insurance documents, you know things get complicated quickly. ERISA covers a lot of complex territory.

It not only sets presumably reasonable minimum standards for retirement and health benefits, it also specifies their income tax consequences and even provides a way for their assets to be divided in a divorce.

As an employee, you’ve likely seen ERISA in action when you’re informed by your employer about your health and retirement plans, what they offer, how they’re funded, changes being made to them, etc. ERISA also specifies how your grievances would be handled and how you could appeal decisions. Finally, the law also gives you the ability and the procedures to file lawsuits against your employer and their providers and under what circumstances.

Violating ERISA is serious

You can sue your employer and their carrier/provider in civil court for violating your rights under ERISA. If you prevailed, you could recover losses you suffered because of the wrongdoing.

Prosecutors sometimes also file charges in federal criminal court under ERISA, with the potential of stiff fines and serious jail time for employers, accountants and others.

Common civil or criminal violations can include denying benefits to people with rights to them, embezzling from or managing funds for personal gain, lying to regulators or employees, failing to keep proper records, backdating transactions, punishing whistleblowers, and much else.

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Martin D. Haverly, Attorney at Law
Brandywood Plaza, 2500 Grubb Road
Suite 240-B
Wilmington, DE 19810

Phone: 302-529-0121
Fax: 302-529-1123
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