For the past six years, participants in American Airlines' 401(k) plan have potentially lost about $88 million in returns they might have expected. This is the opinion of a U.S. District Court judge who rejected a settlement the airline proposed to bring to an end a dispute with those participants. American offered $8.8 million to settle the case in which the participants accuse the company of failing in the fiduciary duties outlined by the Employee Retirement Income Security Act. Those in Tennessee may know this better as ERISA.
Getting sick is one of the great fears of workers in Tennessee. Missing work means losing pay for many whose employers do not offer paid sick days. Because of this, employees may show up for work with fevers, coughs or stomach flus that they pass along to their colleagues. Many employers would like to offer paid sick leave, but if their companies cross state lines, the employers may be stymied by the lack of uniformity in state leave laws. Lawmakers are considering a plan to fix this, and it involves amending the Employee Retirement Income Security Act of 1974, otherwise known as the ERISA laws.
When companies offer their stock as benefits to their workers, the fiduciaries of those benefits typically fall under the eye of the Employee Retirement Income Security Act. ERISA regulations ensure that minimum standards are met when private companies provide such benefits. Tennessee business may not be required to provide those benefits, but if they do, they must follow the guidelines ERISA has established.
General Electric Corporation, one of the largest Fortune 500 companies in the world, is also one of the most profitable. The conglomerate employs hundreds of thousands in Tennessee and all 50 states, not to mention internationally. Some of those employees are not very happy with the way GE has handled their retirement fund investments. In fact, GE is facing a lawsuit claiming the company violated federal ERISA regulations.
Investors in retirement plans place a great deal of trust in those responsible for managing the plans. After all, reaching retirement age only to find the funds have been mismanaged allows few options for recovery. Recently, numerous prestigious colleges across the country, including in Tennessee, have come under fire for the way their retirement plans are being handled, and class action lawsuits are growing, claiming violations of ERISA laws.
It is no secret that retail stores in Tennessee and elsewhere are struggling to keep up with changes in consumer shopping habits. Brick-and-mortar stores that do not also have a strong e-commerce presence continue to fight through bankruptcies and lawsuits. Sears Holdings Corporation, for example, seems to be trying to hold on to solvency even as the value of company stocks declines. Because of these failing stocks, participants in the company's retirement plan recently filed a lawsuit claiming Sears fiduciaries violated their duties according the ERISA rules.
Often a benefits package is one of the deciding factors taken into consideration when someone in Tennessee applies for a job. This may include such things as a pension, retirement fund, health insurance or profit-sharing. However, it is not unheard of for such private employers to lure workers in with big promises only to disappoint by denying those benefits or changing the scope of the plans without warning. This is where ERISA comes into play.
When Congress passed the Employee Retirement Income Security Act of 1974, guidelines were set to protect citizens in Tennessee and across the country from unscrupulous fiduciaries concerning benefits offered by private industries. In 1980, Congress decided that ERISA laws do not include those benefits offered by churches. Recently, participants in several church-affiliated health plans challenged this exception as it related to their employers. Their argument went all the way to the U.S. Supreme Court, but the employers prevailed.
Investing years of time and effort working for a Tennessee company has its rewards. Often, long-term employees feel a certain pride in their work, a loyalty to the employer and a development of important, marketable skills. Additionally, they often expect a pension when they retire. When that pension does not come through, an employee may be concerned about how to manage in the future, especially if the company ceases operations. In some cases, however, the Employee Retirement Income Security Act of 1974 (ERISA) may cover them.
The Employee Retirement Income Security Act was passed in 1974 to protect workers who are covered by benefit plans through their employers. The law requires private sector employers in Tennessee and across the country to inform their employees how to obtain their benefits and any limits that exist on those benefits. Fiduciaries are also held accountable for managing the benefits in an ethical way. Recently, a group of retirees in another state claimed their ERISA rights were violated when their former employer changed its benefits policy.