What is the Employee Retirement Income Security Act of 1974?


Quick Answer

The Employee Retirement Income Security Act (ERISA) of 1974 is a law that sets a minimum standard for pension and healthcare plans in private industry, according to the United States Department of Labor. Under this act, companies must provide adequate information regarding plan features and funding and provides an appeals process to help people get benefits.

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Full Answer

Although the Employee Retirement Income Security Act still exists, it has gone through a number of changes over the years. Amendments to the law include the Mental Health Parity Act, Newborns and Mothers Health Protection Act and the Women's Health and Cancer Rights Act.

The ERISA made it possible for some workers to hold on to their healthcare coverage after when the Consolidated Omnibus Budget Reconciliation Act (COBRA) was passed and the health Insurance Portability and Accountability Act is an amendment to ERISA that helps workers with preexisting medical conditions purchase health insurance.

Despite ERISA's reach, it doesn't cover everyone. It does not cover churches, unemployment recipients, disability recipients, government employees, and worker's compensation recipients, reports the Department of Labor.

ERISA makes it easy for employers to comply with its laws by providing materials such as printed publications and fact sheets to help them reach out to their employees.

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