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Understanding Your Rights Under ERISA

Posted: Jan 05, 2016 | Posted in:

The Employee Retirement Income Security Act (ERISA) is a federal law that establishes minimum standards for employer-sponsored retirement plans. As an investor in one of these plans, you have rights – including the right to file a lawsuit to recover your losses under certain circumstances. Continue reading to learn more about your rights and find out what to do if you have suffered unexpected losses in your 401(k), pension, or other employer-sponsored plan.

How ERISA Protects Individual Investors

Under ERISA, companies that offer plans to help manage their employees’ retirement savings are subject to numerous requirements. Specifically, ERISA applies to two types of plans:

  • Defined benefit plans – Defined benefit plans guarantee a specific benefit upon retirement. A pension that pays $500 per month or a percentage of your average salary after you retire would be a defined benefit plan.
  • Defined contribution plans – With a defined contribution plan, there is no guaranteed benefit, but instead employees (and often their employers) contribute funds into an investment account. 401(k) plans and employee stock ownership plans (ESOPs) are two common examples of defined contribution plans.

The requirements imposed upon employers that offer these plans are designed to protect employees from mismanagement of their retirement funds. In legal terms, employers and plan managers owe a “fiduciary duty” to make prudent investment decisions on behalf of their employees. This means that employers and plan managers must:

  • Provide employees with complete and accurate information about their retirement plans and the company’s financial situation
  • Manage retirement plans with employee-investors’ best interests in mind
  • Take prudent action to prevent avoidable investment losses
  • Suspend purchase of the employer’s stock when they know the stock is likely to crash
  • Provide employees with access to their retirement funds as desired or agreed

When employers and plan managers breach their fiduciary duties and commit other ERISA violations, employees who are harmed can seek financial compensation.

What to Do if You Have Suffered Unexpected Losses in Your Employer-Sponsored Retirement Plan

If you believe that you may have suffered improper losses in your employer-sponsored retirement plan, the most important thing you need to know is that you may need to act quickly in order to protect your rights. If you wait too long to take action, you could harm your chances of recovering your retirement funds. At Zamansky LLC, we have handled numerous ERISA cases – including nationwide class actions against some of the largest companies in the country – and if you have a claim, we will help you fight for the compensation you deserve.

Do You Have an ERISA Claim? Contact an Attorney at Zamansky LLC Today

To learn more about your rights under ERISA, we invite you to schedule a free, confidential consultation. Our attorneys have decades of experience representing individual investors in ERISA claims, and we are committed to ensuring that our clients are fairly compensated for their losses. To speak with an attorney at Zamansky LLC about your case, please call (212) 742-1414 or contact us online today.