What Is an ERISA-Qualified Plan?

ERISA-qualified plans are private-sector retirement plans that adhere to the requirements of the Employee Retirement Income Security Act and its amendments, reports the U.S. Department of Labor. The plans may be defined contribution plans or defined benefit plans. Requirements include disclosure of plan information, minimum standards of participation and funding, management fiduciary responsibility, and an established appeals process.

In defined contribution plans, employers and employees contribute funds to employee accounts, and the value of the accounts derives from the amounts contributed and returns on investments, explains the U.S. Department of Labor. These include profit sharing plans, 401(k) plans, Simplified Employee Pensions Plans, Savings Incentive Match Plans for Employees of Small Employers and Employee Stock Ownership Plans. In a defined benefit plan, an employee receives a guaranteed monthly retirement amount that the plan stipulates. Regardless of the type of plan, employers must provide employees with a comprehensive description of the plan, explanations of changes to the plan, periodic benefits statements and annual reports. They must also establish an appeals process that allows employees to sue for benefits.

ERISA does not oblige private employers to establish retirement plans or stipulate plan packages and features, according to the U.S. Department of Labor. Employers can terminate plans as long as they compensate employees with full vesting. However, when employers implement retirement plan decisions, they must follow ERISA regulations.