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Employee Retirement Income Security Act


The Employee Retirement Income Security Act of 1974 (ERISA) was designed to protect employees from private employers who might mismanage employee benefits plans. Among the items covered in ERISA laws are health benefits, pension plans, and employee stock ownership plans. In cases where ERISA protections are violated, employees can file a lawsuit to hold those responsible accountable for their actions and receive compensation for their losses.

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ERISA Laws

ERISA laws are federally enacted laws that set out the requirements for private employers who offer benefits to their employees. Such benefits frequently include health plans, pension plans, or employee stock ownership plans. Just because an employer offers these plans, however, does not mean the employer is free to run the plans how he or she sees fit.

Under ERISA laws, the fiduciaries responsible for overseeing benefits plans must act in the best interests of the plan, must provide plan participants with complete information about the plan—including how the plan operates, how benefits are calculated, and how benefits are paid—and must provide a process through which employees can appeal or grieve denials of their applications for benefits.

Among those who may be considered plan fiduciaries are trustees, administrators, employers, and anyone who sits on the investment committee. In addition to running the plan in the best interests of participants and beneficiaries, fiduciaries must avoid conflicts of interest when they run the plan.

Before employees are eligible to file a lawsuit under ERISA, they must exhaust the appeals process and must meet strict ERISA filing deadlines.
 

Health Benefit Plans

Group health benefits plans are frequently offered by employers as a benefit for employees. The plans ensure participants and their dependents have access to medical care either by providing that care directly, by providing insurance coverage for medical care, by reimbursing participants for expenses, or through other means.

If a group health insurance benefits plan has been mismanaged, employees may be able to file a lawsuit against the plan fiduciary, to ensure they have access to the medical care, insurance, or funding as set out in the plan agreement.

Meanwhile, if access to insurance benefits have been unreasonably denied by an insurance company, plan participants may be eligible to file a lawsuit under ERISA to have their insurance denial reversed. Before they can do so, however, they must first follow the insurance company's appeals process.
 

Pension Plans

ERISA also sets out guidelines for managing retirement plans—including defined benefits plans, defined contribution plans, simplified employee retirement plans, and 401(k) plans. Employers must manage the plan in the manner agreed upon in the plan agreement or summary plan description and must provide certain advance notice to employees.

If fiduciaries mismanage funds or otherwise acted improperly in carrying out their duties, they may be held personally liable for any losses experienced by the plan as a result of their actions. This might include reimbursing missing contributions, including lost earnings or interest.
 

Employee Stock Ownership Plans (ESOP)

Employee Stock Ownership Plans (ESOP) are employee benefit plans in which assets are mainly invested in the employer's stock, giving employees an ownership interest in their employer. Employers are required to provide a summary plan description that explains the rules for how the ESOP is managed, when they can access benefits, and how they can appeal ESOP operations. Fiduciaries can get into trouble, however, if a plan's assets remain invested in the company when it is no longer prudent to do so, or if the fees associated with the plan's investment are higher than they should reasonably be.
 

ERISA Lawsuits

There are situations in which employees can file ERISA lawsuits against a plan or its fiduciaries:
  • To appeal a claim for benefits that was denied
  • To recover missing benefits
  • To prevent a plan from being managed in a way that violates ERISA laws
  • To stop fiduciaries from mismanaging plans

In cases where ERISA plans have been mismanaged, legitimate claims for benefits have been denied, or plan administrators have breached their fiduciary duties, plan participants and their beneficiaries may be eligible to file an ERISA lawsuit.
 

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ERISA VIOLATION LAWSUITS


ERISA VIOLATION LEGAL ARTICLES AND INTERVIEWS

ERISA Lawsuit Settlement Hits Stumbling Block
ERISA Lawsuit Settlement Hits Stumbling Block
January 30, 2023
The partial settlement of Berry v. FirstGroup America, which seemed like a sure thing less than a month ago, has hit a snag that may require substantial changes. The class action ERISA lawsuit alleged that FirstGroup America removed well-performing investment funds from the FirstGroup America, Inc. Retirement Savings Plan (the “Plan”) and replaced them with newly-launched Hewitt funds. The plan fiduciaries made this change at the urging of Hewitt, its investment adviser (later known as “Aon Hewitt” and now “Aon”). The results were disastrous. Plan participants allegedly lost tens of millions of dollars. READ MORE

L3 Technologies ERISA Lawsuit Seeks Class Action Status
L3 Technologies ERISA Lawsuit Seeks Class Action Status
December 28, 2022
On November 28, a group of former employees for defense contractor L3Harris Technologies Inc. asked the District Court for the Middle District of Florida to grant class action status to their ERISA lawsuit. Stengl v. L3Harris Technologies Inc. alleges that the fiduciaries of L3 Technologies Master Savings Plan, (the “Master Plan”) a predecessor to the L3Harris retirement plan, (the “L3Harris Plan”) failed to prudently monitor costs and investment performance of plan assets in violation of ERISA. READ MORE

Yale University Pension Plan Lawsuit Heading to Jury Trial
Yale University Pension Plan Lawsuit Heading to Jury Trial
December 12, 2022
 On October 21, 2022, the Federal District Court for the District of Connecticut held that participants in the Yale University Retirement Account Plan will have an opportunity to present their allegations of financial mismanagement to a jury. The ERISA lawsuit alleges that plan administrators violated their ERISA fiduciary duty to plan participants by allowing the plan to incur excessive costs, unreasonably delaying a decision to switch to a single recordkeeper and permitting a recordkeeper to aggressively market services outside the plan to participants. The plaintiffs in Vellali v. Yale Univ. allege that these failures cost participants millions of dollars in excess fees. READ MORE

READER COMMENTS

Posted by

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i was part of a pension plan and had my benefits cut short because of the IRS415 rule... then the plan stopped my cola increase.. then they cut my pension 2200.00 a month... i`m oonly getting 1/3 of what i should be getting for spending 25 years in a pension fund.... can anyone help?

Posted by

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Can you tell me if Lockheed Electronics is part of the class action lawsuit?

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