Regulating Private Pensions: A Brief Summary of ERISA

The Employee Retirement Income Security Act of 1974 (ERISA, P.L. 93-406) protects the interests of participants and beneficiaries in private-sector employee benefit plans.It was passed in response to instances in which employers had failed to prudently manage pension funds, had terminated pension plans without sufficient assets to pay the benefits employees had earned, or had created impediments to earning a pension, such as onerous age and service requirements.ERISA covers a number of fringe benefits provided by employers, but most of its provisions deal with pension plans.Pension plans sponsored by the federal, state, and local governments, or by churches generally are exempt from ERISA.(This report will be updated for amendments to ERISA.)