What is ERISA and how does it apply to me?

On Behalf of | Mar 4, 2020 | ERISA Process And Procedures

ERISA. It’s a term you have probably seen before, likely when reading about certain employer-provided benefits such as long-term disability insurance. For most people, ERISA doesn’t seem like something they need to think about. In reality, ERISA impacts the life of most American workers, offering them certain protections that might not otherwise exist.

So what is ERISA, exactly? Here’s a brief explanation.

What is ERISA?

ERISA stands for the Employee Retirement Income Security Act of 1974. It’s a law that sets minimum standards for certain aspects of benefits, including:

  • Retirement plans
  • Long-term disability coverage
  • Health plans
  • Life insurance

What types of minimum standards?

The minimum standards ERISA lays out aren’t really about the type of care or compensation you might receive. Rather, it’s about how the benefits plans are administered and managed by certain parties. For example, plans regulated by ERISA must provide plan participants information about features and funding. It also requires plan providers to set up an appeals process, and provide information on how to file an appeal.

ERISA also allows participants to sue under certain circumstances if they believe something has been wrongly handled.

Does ERISA apply to my benefits?

Generally speaking, ERISA regulates retirement and health plans that private employers offer to workers. It does not apply to benefits plans offered by the government or churches to employees. It also does not apply to plans you may purchase privately.

If you have health insurance, long-term disability coverage or a retirement plan through an employer, those benefits likely would follow ERISA guidelines.

What else should I know?

ERISA is a particularly complex law. The goal is to protect workers and give them an opportunity to hold their plan administrator or fiduciary accountable, but from the outside, that can seem difficult.

There are avenues toward a resolution however, and ways for you to get the compensation you rightfully deserve. It might just take some legal maneuvering to do so.