ERISA reflected a bipartisan approach to employee benefits. It was enacted in 1974 during a Republican administration – President Ford – and became effective on January 1, 1975. Its lead legislative proponent was a liberal Republican Senator from New York, Jacob Javits. There had emerged a consensus during the 1960s that pension reform was necessary and ERISA was the product of negotiations largely between organized labor and management to deal with retirement issues. There was little, if none, political backlash after ERISA was enacted. 

The Affordable Care Act, meanwhile, arose in a more partisan environment. Unlike ERISA, where Democrats and Republicans worked jointly to produce legislation, the ACA was the by-product of a Democratic legislature and executive branch, with almost no Republican support. While health care is a national issue, there seems to be little political consensus as to how to address these issues. 

The ACA governs health care issues, whereas ERISA deals with retirement, health care, and other benefit issues. ERISA is the broader piece of legislation, impacting more segments of benefits offered by employers in private industry. However, the ACA is attracting considerable attention now because of the prominence of health care issues.

Also see: 11 ERISA milestones

The incredible breadth of ERISA coverage is a little known fact. You can set up tuition plans under ERISA, all types of employee benefits can be established under ERISA – two sentences in an employee handbook can become an ERISA plan even if none of the ERISA formalities are observed. Employers have to analyze their practices constantly to ensure that they have not inadvertently established an ERISA plan.

Howard Shapiro is a New Orleans-based partner and head of the ERISA litigation group at management-side law firm Proskauer.

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