For some employee benefit professionals, it may be hard to imagine that the landmark Employee Retirement Income Security Act of 1974 marks its golden anniversary on September 2, 2024. Nearly 50 years after its enactment, the statute that began as a way to safeguard workers’ and retirees’ pension benefits has evolved into a pervasive scheme impacting nearly all aspects of employer-sponsored benefits packages. Many of your employer clients may not wish to celebrate ERISA’s anniversary, but at least this milestone doesn’t come with another employee notice to mail out.
ERISA was, in part, a reaction to the 1963 Studebaker automobile bankruptcy and the company’s decision to close its South Bend, Indiana manufacturing plant, leaving thousands of workers under the age of 60 with minimal or no pension benefits. For nearly a decade, Congress studied, debated and drafted, and on Labor Day 1974, President Gerald Ford signed sweeping legislation that included both carrots and sticks for employers. Companies were not required to offer pension plans to their employees; but if they did, the plans had to satisfy various participation, funding and vesting rules, along with certain reporting and disclosure rules (e.g., notify employees of their ERISA rights and inform the government about plan operations).
