​Legal & Regulatory (ERISA) Framework​

The Employee Retirement Income Security Act of 1974 (ERISA) created requirements for all private sector defined benefit pension plans regarding funding, vesting, reporting, fiduciary duties and financial disclosure. The Act established insurance for pension benefits through the Pension Benefit Guaranty Corporation (PBGC).

The Legal Framework

Fiduciary Standards

 

ERISA Reporting and Disclosure Requirements

Statutes vs. Regulations

A statute is the law as it was passed by the U.S. Congress or a state legislature. When a law is codified, the provisions of laws are arranged by topic and all superseded or repealed sections of the code are removed.

Regulations are the detailed rules that outline how statutes will be enforced and have the force of law. While legislative bodies write statutory law, administrative agencies of the executive branch of government produce regulations.

​Key Legislation

​​M​ultiemployer Pension Plan Amendments Act of 1980 (MPPAA)

  • Clarified definition of multiemployer plans
  • Established withdrawal liability process

Healt​h Insurance Portability and Accountability Act of 1996 (HIPAA)

  • Established standards to protect privacy and security of an individual's health information

Pension​​​ Protection Act of 2006 (PPA)

  • Established new minimum funding requirements for pension plans
  • Created zone statuses to reflect funding situations of multiemployer plans 

​​Patient Protection and Affordable Care Act of 2010 (ACA)

  • Required larger employers to offer affordable, minimum value health plans to workers or pay penalties
  • Mandated various health plan design provisions
  • Mandated individuals to get health insurance; created public health insurance exchanges/marketplaces for those who do not have access to health care coverage elsewhere; offered subsidies/tax credits to those who cannot afford to buy coverage on the exchanges

​Multiemployer Pension Reform Act of 2014 (MPRA)

  • Allowed pension plans in critical and declining status to suspend/reduce pension benefits for active workers and retirees
  • Increased PBGC premiums for multiemployer pension plans
  • Allowed PBGC to facilitate multiemployer pension plan mergers and partitions (In a plan partition, the PBGC can remove troubled liabilities from a plan to keep the plan solvent.)

Key Government Agencies

A few government agencies have the responsibility to write the regulations and enforce most of the laws affecting employee benefits.

Department of Labor (DOL)

​Internal Revenue Service (IRS)

  • ​Principal responsibility for enforcing ERISA vesting, minimum participation
  • Determines whether a retirement plan is tax-qualified (receives favorable tax treatment)

​Pension Benefit Guaranty Corporation (PBGC)

  • ​Insures pension benefits provided by defined benefit (DB) pension plans
  • DB plan sponsors pay annual premiums to PBGC for insurance
  • Two separate insurance programs for single employer plans and multiemployer plans

Other government agencies 

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