• Does an employer have legal obligations with respect to employee pension plans?
• What pension plans are covered under ERISA?
• What is a fiduciary?
• What is a beneficiary?
• What are an employer's obligations with respect to employee pension plans?
• Does anyone else have fiduciary or other obligations with respect to employee pension plans?
• What can I do if my employer has breached its fiduciary duties?
• What steps can I take to seek recovery?

Yes. The Employee Retirement Income Security Act of 1974 ("ERISA") imposes obligations on employers who control or administer their employees' pension plans. This is because an employer is generally a fiduciary, with the authority to control and manage the operation and administration of the plan.

ERISA sets minimum standards for the administration of plans and the investment of plan assets. It does not require employers to offer a certain level of benefits to its employees, or to offer employees any benefits at all. For this reason, the language of the plan document is often determinative. It is therefore extremely important to know what your plan says, and to insist on seeing a copy of the plan document yourself, rather than simply relying on assurances by your employer or your employer's representatives.

A pension plan is governed by ERISA if it is a plan, fund, or program established or maintained by an employer (or an employee organization, or both) that, either explicitly or because of surrounding circumstances, (1) provides retirement income to employees or (2) results in a deferral of income by employees until after termination of covered employment or beyond.

Most private employer-sponsored pension plans fall within the scope of this definition. Plans and benefits that do not fall within this definition include government employee pension plans, vacation pay, health club benefits, family leave, and workers' compensation.

A fiduciary is a person or entity with special obligations arising from the relationship of trust between the fiduciary and the beneficiary. The fiduciary holds rights that would normally belong to another person, and is therefore held to a high standard of care in the exercise of those rights.

An employer is a fiduciary with respect to an employee pension plan if the employer is named as a fiduciary in the plan, or if the employer exercises "any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets" or has "any discretionary authority or discretionary responsibility in the administration of such plan."

Most employers are fiduciaries with respect to pension plans that they have established or that they maintain. We use the term "employer" in the questions below to mean an employer who is a fiduciary with respect to a pension plan.

A participant is any employee or former employee of an employer who is or may become eligible to receive a benefit of any type from that employer's employee benefit plan.

A beneficiary is a person designated by a participant or by the terms of a plan who is or may become entitled to a benefit under the plan.

A person can be both a participant and a beneficiary. Participants and beneficiaries can assert their rights under ERISA against fiduciaries who do not comply with the required standard of care.

As a fiduciary, an employer must discharge his or her duties with respect to a pension plan solely in the interest of the plan's participants and beneficiaries and for the exclusive purpose of providing benefits to participants and their beneficiaries. In other words, an employer who is a fiduciary must administer pension plans and invest plan assets solely for the benefit of the plan's participants and beneficiaries, and not for any other reason, including any other business purpose or the company's bottom line.

An employer who is a fiduciary has a duty of loyalty to plan participants and beneficiaries. An employer-fiduciary also must not conceal any breaches of responsibility by any other fiduciaries of the plan.

An employer who is a fiduciary also has a duty of prudence. This means that the employer-fiduciary must act with care, skill, prudence, and diligence with respect to a pension plan; must diversify investments; and must act in accordance with the provisions of the plan itself. This includes ensuring that the plan is properly funded and has sufficient assets to satisfy its accumulated benefit obligations.

An employer who is a fiduciary has a duty not to engage in self-dealing. Transactions between a plan and a party in interest are prohibited, and an employer that sponsors a plan is a party in interest. In the absence of a specific exemption, transactions between the employer and the plan constitute breaches of the employer's fiduciary duty.

An employer who is a plan administrator also has a duty to inform. This means that such an employer must provide employees adequate, accurate, and understandable information about the plan's provisions, benefits, and source of funding, including any changes to this information.

Providing misleading or incomplete information violates this obligation. As part of the employer's duty to inform, every plan participant has the following rights:

• The right to obtain a copy of the plan document from the plan administrator.
• The right to receive a summary plan description (SPD) upon joining the plan and at specified intervals thereafter. The SPD is a description of the plan's terms that is (or should be) in language that is understandable.
• The right to obtain a copy of the plan's most recent annual statement (Form 5500).

You must request these documents from the plan administrator in writing, and the plan administrator has 30 days from the receipt of your request to respond.

ERISA also imposes fiduciary obligations on anyone who renders investment advice for a fee or other compensation, or who has any authority or responsibility to render such advice, with respect to any pension plan money or property.

In addition, in certain circumstances, some service providers to the pension plan (such as attorneys, accountants, actuaries, etc.) may be liable to the plan and/or its participants for professional negligence.

You should first seek recourse from the internal claim and review procedure provided under your plan. Plans are required to have an internal procedure by which participants may bring and appeal disputed claims. Many courts have held that participants must exhaust this internal procedure before filing a lawsuit. It is a good idea to consult an attorney even in this internal procedure to ensure that you act in a timely fashion to preserve all your rights and remedies under your plan and the applicable state and federal laws, including ERISA.

An attorney can help ensure that you submit all possible evidence in support of your position while evidence is fresh and more easily accessible, and so that the evidence becomes part of the record of your claim. An attorney can also help advise you of the relevant deadlines, which may come quickly - for example, many plans require you to appeal the denial of a claim within 60 days of the denial. An attorney can also tell you whether your claim is exempt from the internal claim and review procedure, in which case you may decide to file a lawsuit.

When internal procedures are insufficient to resolve a claim, or when a claim is not subject to internal procedures, ERISA gives plan participants and beneficiaries the right to sue fiduciaries for breaches of their obligations. Again, important deadlines apply, so time is of the essence.

The right to sue must be exercised within six years of the employer's breach, or within three years of the employee's actual knowledge of the breach. A breach can involve an overt act by an Employer, or an omission - that is, a failure to act when action was required.

An employer may be liable under ERISA for any losses to the plan resulting from each breach of its fiduciary obligations. The employer must restore to the plan any profits the employer made through use of the plan's assets and must provide any other relief that a court deems appropriate in light of the violation.

First, be wary of relying on promises or assurances given to you about your benefits or pension plan by your employer, plan administrator, insurance representative, or anyone else who is not properly qualified to offer legal advice. Many times employees will rely on such representations only to find out later that these representations conflict with the language of the plan.

The language of the plan is legally binding, while representations, even by persons in positions of authority, generally are not binding and not enforceable. Always check the language of the plan and, if you have any questions or doubt about its provisions, consult with an attorney.

You can also seek answers to certain questions from your local office or the website of relevant government agencies including the Department of Labor (www.dol.gov), the Pension Benefit Corporation (www.pbgc.gov), and the IRS (www.irs.gov).

If you believe that you have suffered a loss because your employer breached its obligations with respect to a pension plan of which you are a participant or a beneficiary, you should contact an attorney as soon as possible. An attorney can help ensure that you are aware of the available legal remedies and applicable deadlines, and that you act in a timely fashion to preserve your rights.