Erisa Law Guide, Resources & information
Employee Retirement Income Security Act (ERISA) under its Constitutional.The act was passed in response to the mismanagement of funds in direct benefit plans. All employers who engage in interstate commerce and provide defined benefit plans to their employees must abide by ERISA guidelines. The provisions of ERISA do not apply to defined compensation plans.
ERISA is highly complicated and provides detailed regulations for many aspects of defined contribution plans. ERISA requires that employers provide both the Labor Department and its employees with detailed descriptions of the benefits they are to receive. It also outlines which employees must receive a pension if they are offered and requires that a percentage of the retirement benefits become vested in the employees after they have worked for a given number of years and/or have reached a given age. ERISA also requires that pension plans provide benefits to an employers survivors upon his death. The legislation also requires employers to adequately fund the program and establishes fiduciary responsibilities that must be adhered to. ERISA also establishes the Pension Benefit Guaranty Corporation to insure defined benefits plans. (PBGC). Employers must pay premiums so that their plans are covered by the PBGC. The termination of plans is also extensively regulated.