The Employee Retirement Income Security Act provides protection for the funds that non-government employees invest in health care, retirement and other benefit plans, reports About.com. This includes regulations for those responsible for plan management, reporting of plan details to the federal government, required disclosures to plan participants, and the establishment of a clear process for filing claims and appealing. ERISA also guarantees benefit payments of terminated plans through the Pension Benefit Guarantee Corporation, notes the U.S. Department of Labor.Continue Reading
Employers do not have to set up benefit plans for employees, but once they set them up, they must follow ERISA guidelines, explains the U.S. Department of Labor. Fiduciaries who manage plan assets or give investment advice must abide by ERISA principles of conduct or repay plan losses for which they are responsible. ERISA stipulates how long employees need to work before they become eligible plan participants with rights to accumulate and retain benefits. It also requires sponsors to maintain adequate funding for plans.
As of 2015, ERISA requires employers to provide plan participants with details about funding, the appeals process and other plan features, points out the U.S. Department of Labor. It allows plan participants to sue for withheld benefits or inefficient plan management. The Consolidated Omnibus Budget Reconciliation Act, or COBRA, is an amendment to ERISA that allows employees who lose their jobs to receive continued health coverage for a limited time. The Health Insurance Portability and Accountability Act, or HIPAA, is another amendment that protects the health care benefits of employees with pre-existing health conditions.Learn more about Financial Planning