ERISA Lawsuit

The Employee Retirement Income Security Act of 1974 (ERISA) was put into act to ensure fair practices relating to employer-sponsored health, pension, and profit-sharing plans. ERISA allows these plans to be governed by this federal act. ERISA sets minimum standards for benefit plans, the vesting of benefits, and communication to plan participants and their beneficiaries.

There are several different plans or programs that are covered under ERISA. Plans, funds, or programs that provide medical, surgical, or hospital care benefits are covered by ERISA as well as retirement income or the deferral of income after retirement or termination, i.e. severance pay. Deferred compensation plans such as stock bonus and money purchase pension plans are also covered under ERISA.

ERISA lawsuits have been brought against corporations for misappropriating funds originally set aside for participant's plans. The best way to avoid having to enter an ERISA lawsuit is to monitor and regularly examine reports provided to you by your employer concerning your current benefits. Plan officials may not be investing your money properly if your returns are showing constant losses. Approach management and convey your ideas to them about how you want your money invested, and avoid a later ERISA lawsuit.

Another way to prevent having to file an ERISA lawsuit is keeping up with the timing of your statements. Statements that consistently come late or at odd intervals are suspect. Check with your benefits department to find out why and demand such reports if they are not periodically forthcoming.

Ask your retired friends to see if they are having any problems being paid out. If they can't get the pension plan to pay them what's due, start checking further and suggest an ERISA lawsuit. Always request such reports when you believe the company is having financial difficulties, such as when paychecks are not being distributed on time.

Most importantly, when trying to prevent a future ERISA lawsuit, keep track of how much you're contributing to the pension and then match your records to the reports you receive from the plan. Statements should specify the amount you and your employer have contributed, plus the rate of return you've earned on your investments. If the numbers don't match, it is possible that the employer is illegally holding or diverting your contributions.

A red flag for a potential ERISA lawsuit is if you are fired two months before the finalizing of a pension. You can argue that the timing of the firing is suspect and that public policy requires the employer to grant your pension. If the employer refuses, consult an experienced employment lawyer immediately to file an ERISA lawsuit.

If your company goes out of business, files for bankruptcy, or has no assets, many states require the owners and officers to be personally liable to repay pension and other retirement benefits. If you discover your benefits were diverted and the company goes out of business, you may still be able to recover through an ERISA lawsuit. Contact an experienced ERISA lawsuit attorney today if you believe that you have a claim against your employer.