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Important facts about the Employee Retirement Income Security Act

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In California and all across the country, it is very important for people to know about the Employee Retirement Income Security Act, which is commonly known as ERISA. It is there to protect them when they are setting up a pension plan or getting employee benefits, ensuring that businesses, even those that are privately owned, have standards that must be met at all times. The act was put into place back in 1974.

For one thing, ERISA states that information about the plans has to be provided to the employees. This information could relate to the specific features of the plan and the funding options. Basically, employees must be informed of what their benefits are and how they work.

Another thing to note is that the act is not just the same today as it was when it was first set up in 1974. Amendments to it have been created as needed. Not only should employees be aware of those amendments that are on the books, but they should keep their eyes open for new ones that could change the act's overall impact.

For instance, the Consolidated Omnibus Budget Reconciliation Act, which is often referred to as COBRA, ensures that people will not lose all of their health coverage if their job is lost. It extends that coverage. This extension is not limitless, and COBRA does not cover everyone, but it can help.

Another addition was the Health Insurance Portability and Accountability Act, which is called HIPAA. Among other things, it is based around ensuring that people are not discriminated against -- which could otherwise happen in the case of a preexisting condition, for example -- when it comes to the health coverage that they can get.

Source:  U.S. Department of Labor, "Employee Retirement Income Security Act -- ERISA" Aug. 05, 2014

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