The Employee Retirement Income Security Act (ERISA) is a federal program legislated in 1974 with the purpose of standardizing benefits for employees such as healthcare, retirement and profit sharing. Prior to the implementation of ERISA, an employee might pay into such programs faithfully over a career with the expectation that benefits would be available at retirement, and then discover, only too late, that the actual benefits were minimal. The U.S. Department of Labor administers ERISA and operates as a watchdog agency to protect employees from private businesses that do not provide the benefits they promise. Your New York disability attorney may be able to help you if you believe you were unfairly compensated.
A New York Disability Attorney Explains What ERISA Does
With the enactment of ERISA, employers who offer benefits programs are required to make available to its employees important and relevant information, including who retains fiduciary responsibility. As your New York disability attorney will tell you, the act provides guarantees that the money you contribute for retirement, health insurance, etc. is protected. If a breach of fiduciary duty occurs, you and your lawyer have the right to sue to recover damages.
A New York Disability Attorney Explains Provisions under the Act
Specifically, ERISA sets the standards for how private businesses operate benefits programs. These include:
• Financial Protection. ERISA provisions ensure that funding of benefits plans are protected and maintained for the best interests of contributing employees. Discriminatory practices which limit receiving of compensation are strictly prohibited.
• Accountability. The employer must provide detailed reports to the federal government which reflect accountability.
• Conduct and Management. ERISA regulates the management of healthcare maintenance organizations (HMOs), as well as the conduct of fiduciaries.
• Availability of Information to Employees. Employers who provide these benefits programs are required to disclose the specifics of the plans to participants through Plan Summaries and to provide guidelines for obtaining referrals.
Since its inception, ERISA has been amended twice in order to add protections to program participants. These amendments deal specifically with healthcare matters:
• COBRA (1985). The Consolidated Omnibus Budget Reconciliation Act allows exiting employees to retain their current healthcare at their own cost.
• HIPPA (1996). The Health Insurance Portability and Accountability Act establishes privacy standards for the medical records and health information of patients.
A New York Disability Attorney Explains Why ERISA Was Necessary
Prior the ERISA there were no standards for the management of healthcare and pension programs. Accountability was virtually up to the employer, and no federal oversight existed. This led to widespread mismanagement of programs and, in some cases, unscrupulous practices. These meant that employees sometimes faced an uncertain future regarding whether adequate benefits would be available to them when they needed them most—at retirement.
A New York Disability Attorney Explains Program Limitations
While ERISA has greatly improved the prospects of employees who are counting on healthcare, retirement and certain investment programs for their sunset years, the act has some distinct limitations. Perhaps the most significant of these is that employers are not required to provide pension or healthcare plans—they simply have to abide by the provisions of ERISA if they do. Furthermore, the act only applies to privately held companies and not government agencies. Finally, money paid by employees into programs may not be protected if the company files for Chapter 7 bankruptcy protection.
Contact a Disability Attorney If You Would Like More Information
If you would like to obtain a more detailed explanation of the benefits and limitations of ERISA or need legal assistance with a matter relevant to the act, it is important that you work with a New York disability attorney who has both knowledge and experience representing clients in such matters. Call Hermann Law Group, PLLC today to arrange an initial consultation. We offer a free case evaluation. Call 877-773-3030.