What are ERISA’s main provisions?

In all likelihood, the Employee Retirement Income Security Act of 1974 protects your pension or retirement plan. If you also have a welfare benefit plan, ERISA likely protects that as well.

The Department of Labor’s Employee Benefits Security Administration explains that by 2013, ERISA protected plans covering upwards of 141 million U.S. workers and their beneficiaries, amounting to over $7.6 trillion in assets.

Enforcement agencies

The following three government agencies enforce ERISA:

1. The Employee Benefits Security Administration
2. The Internal Revenue Service
3. The Pension Benefit Guaranty Corporation

Main provisions

ERISA protects your retirement funds and other benefits from abuse and mismanagement on the part of the plans’ administrators in the following ways:

• It makes all plan administrators fiduciaries who must put the interests of the plan and its participants above all else.
• It ensures that you and other plan participants have access to plan information, especially that pertaining to your own account.
• It allows you to sue a plan’s administrator for restitution if (s)he breaches his or her fiduciary duties, thereby decreasing the value of the plan as a whole or your portion thereof.

As an interesting side note, Section 502(a)(2) of ERISA has always authorized retirement plan participants to sue plan administrators for breaching their fiduciary duties. However, in 1985, the U.S. Supreme Court ruled that defined benefit pension plan participants could sue only if the relief sought would benefit the plan as a whole. Numerous federal courts subsequently interpreted this to mean that defined contribution plan participants, such as those with 401(k) accounts, could not sue under Section 502(a)(2).

Ultimately, on Feb. 20, 2008, SCOTUS held in the case of LaRue v. DeWolff, Boberg & Associates, Inc. that defined contribution plan participants can, in fact, sue plan administrators for breach of fiduciary duty under Section 502(a)(2) of ERISA in the event such fiduciary breach results in a diminishment of the plaintiff’s individual account.