The Employee Retirement Income Security Act is an act that was passed by congress in 1974 in attempt to address inequalities in pension plans in private industry and the way the federal income tax effects employee benefits plants. ERISA is supposed to protect employee benefit plant participants and their beneficiaries by forcing plans to disclose all financial and any other relevant information concerning the plan. ERISA was successful in establishing a certain set of standards concerning the conduct for plan fiduciaries and providing remedies and access to the federal courts. 

The interpretation and enforcement of ERISA is conducted by the Department of Labor, the Department of the Treasury (especially the Internal Revenue Service) and the Pension Benefit Guaranty Corporation. The large number of government bodies involved in ERISA makes uniform enforcement close to impossible. When an individual believes that they have been wronged in regards to their employee benefit plan and wants to site the Employee Retirement Income Security Act, it is difficult to understand who they should be reporting to.

The History of the Employee Retirement Income Security Act

ERISA had its beginnings during the Kennedy administration which put forth the President's Committee on Corporate Pension Plans. Support for a pension plan reform act was greatly fueled by the high profile case of the automobile manufacturer, Studebaker Corporation, whose retirement plans for employees was so poorly funded that the company could not provide many of their employees with pensions. Finally, an NBC broadcast unveiling the abundant issues surrounding pension plans ran and public anger reached an all time high. In the following years, congress would hold a series of public hearings on the subject and eventually came forth with the full Employee Retirement Income Security Act as it was originally published in 1974.

ERISA Today

It is important to understand that ERISA did not require employers to establish pension plans or even to provide a monetary minimum for benefits. It instead regulates the manner in which a pension plan can pay its employees. Millions of Americans have benefited from ERISA since its inception. Employers who were once unrepentant about failing to award their honest employees with their promised pensions, are now much more vigilant about plans in order to adhere to ERISA rules. It is now easier for an employee to rest easy that their pension plans will be waiting for them once they reach retirement age.

For more information on ERISA, contact Indianapolis area attorneys.