How ERISA Works

The Employee Retirement Income Security Act (ERISA) was established to safeguard employees’ interests in retirement and health benefits offered by their employers. It sets standards to ensure that benefit plans are adequately managed and that employees are informed about their rights and plan details. ERISA covers a variety of employer-sponsored plans, including retirement plans such as 401(k) and pension plans, as well as welfare benefit plans like health insurance, disability insurance, and life insurance. However, ERISA does not typically apply to governmental or church-sponsored plans, plans established outside the United States for nonresident employees, or certain compensation arrangements like overtime pay.

Under ERISA, a fiduciary is anyone with discretionary authority or control over plan management, its assets, or the administration of the plan itself. This can include plan administrators, trustees, investment managers, or anyone else who exercises significant control over the plan. Fiduciaries have a critical role in ensuring that the plan operates in the best interests of its participants and must adhere to strict responsibilities. These responsibilities include acting prudently in managing the plan, avoiding conflicts of interest, and ensuring that transactions within the plan align with its objectives. Fiduciaries are also accountable for providing accurate and timely information so participants can make informed decisions about their benefits. Failure to meet these obligations can lead to legal consequences, underscoring the importance of accountability in protecting employees’ benefits under ERISA.

ERISA Violations

• Failure to Disclose Information: Under ERISA, employers must provide participants with detailed and accurate information about their retirement and health plans. A failure to disclose required documents or information, such as a Summary Plan Description (SPD) or annual reports, can prevent employees from fully understanding their rights and benefits, leaving them vulnerable to misinformation or uncertainty about their financial future.
• Denial of Benefits: ERISA ensures employees have access to promised benefits, but some may face wrongful denials due to errors in administration or misinterpretations of plan terms. Denials can have serious financial consequences, especially for those relying on benefits for medical expenses, retirement planning, or disability coverage. Claimants may need to challenge these denials to protect their entitlements.
• Breach of Fiduciary Duties: Those managing and overseeing ERISA-regulated plans have fiduciary duties to act in the best interests of participants. A breach occurs when fiduciaries mismanage funds, fail to follow plan documents, or make decisions that unfairly disadvantage beneficiaries. Such breaches can lead to financial harm for employees and undermine trust in the employer-sponsored benefits.
• Retaliation: ERISA protects employees from retaliation for asserting their rights under the act. This could include being demoted, terminated, or harassed for questioning a denied claim or reporting misconduct. Retaliation violates the protections afforded by the law and can create a hostile work environment.
• Improper Plan Amendments: ERISA also governs the amendment of benefit plans. Failing to provide proper notice of changes, or enacting modifications that unlawfully reduce benefits, may constitute a violation of employees’ rights under the act.

Legal Claims Based on ERISA Violations

The Employee Retirement Income Security Act (ERISA) provides important protections for employees, including the right to bring legal claims when their rights under an employee benefit plan are violated. If an employee believes their plan has been mismanaged, benefits wrongfully denied, or fiduciary duties breached, they can file a claim in federal court. Remedies under ERISA can vary depending on the nature of the violation. For instance, a court may order the payment of wrongfully denied plan benefits, restoration of losses caused by fiduciary misconduct, or changes to ensure the proper management of the plan going forward. In certain cases, employees may also seek equitable relief, such as an injunction to prevent ongoing violations.

Some lawsuits under ERISA are brought as class actions, especially when alleged violations impact a large group of employees who participate in the same benefit plan. Class actions allow employees to collectively pursue claims against an employer, plan administrator, or fiduciary when similar legal issues affect multiple participants. This approach can create efficiency by addressing widespread harm in a single lawsuit, rather than requiring each affected individual to file separate claims.

To initiate a class action under ERISA, specific legal requirements must be met. These include demonstrating that the group has common legal and factual claims, the proposed class is sufficiently large, and that the named plaintiffs can fairly and adequately represent the interests of all class members. Meeting these criteria ensures that the case is managed effectively while protecting the rights of all participants.

Appealing a Denial of a Benefit Claim Under ERISA: Importance and Steps

The Employee Retirement Income Security Act (ERISA) governs a variety of employer-provided benefits, encompassing health and life insurance, disability insurance, pension plans, and more. Unfortunately, denials of ERISA benefit claims can create significant hardships. Should your claim be denied, it’s crucial to fully understand the importance of, and procedure for, making an appeal.

Importance of an Appeal

Appealing the denial of a benefit claim under ERISA is an essential process that can help ensure you receive the benefits, such as disability, that you’re entitled to. A successful appeal can provide the funds and resources needed to provide an income while addressing your health concerns.

In addition, the appeal record can be used as the administrative record if your case ends up in court. This means that any evidence or argument you submit during your appeal could be crucial in a later legal dispute. It is significant that the administrative record that is compiled during the appeal stage contain all the evidence that you may need to use to support your claim at the lawsuit stage.

Steps in the Appeals Process

• Understanding Your Denial: Begin by examining the reason specified for your claim denial in your denial letter. This notice should provide an understanding of the issues you need to address in your appeal.
• Gathering Documentation: Compile all relevant documents, such as medical records or physician statements, which can provide substantial evidence to argue against the denial.
• Submit Your Appeal: Prepare a comprehensive appeal letter detailing the reasons why the denial should be overturned, backed up by your evidence. The letter should be sent to the insurance company within the time limits specified in the denial letter. In most cases, you will have 180 days from that date of the denial to submit an appeal. However, each policy and claim is different and shorter deadlines to appeal may apply to your claim. Be sure to follow all guidelines laid out in your plan for filing an appeal.
• Legal Representation: Given the complexities of ERISA claims and the stakes involved, it might be advantageous to seek the services of a qualified attorney. Our team at Mehr Fairbanks Trial Lawyers could assist with your appeal by preparing a compelling case and ensuring you adhere to all ERISA regulations. Reach out to us at (800) 249-3731 for a consultation.

Assistance With Employee Benefits

Navigating legal challenges related to your employee benefits can be daunting. Federal laws, such as the Employee Retirement Income Security Act (ERISA), provide safeguards designed to protect employees from wrongful treatment, ensuring access to promised benefits and fair practices. Whether you are facing a denial of disability or life insurance benefits, fighting for your benefits is critical. These situations often involve complex legal rules and require thorough attention to detail. At Mehr Fairbanks Trial Lawyers, we assist employees by providing clear guidance through these disputes and advocating for their rights every step of the way. If you’re dealing with an issue related to your employee benefits, call us for a Free Consultation at (800) 249-3731. We’re here to help you understand your options and secure your rights.

The information contained within this post should not be considered legal advice or legal representation.

The National Trial Lawyers has chosen Partners Elizabeth Thornsbury and Bartley Hagerman to the “Top 40 Under 40” National Trial Lawyers for 2025!

Elizabeth’s National Trial Lawyers profile can be viewed here. Bartley’s National Trial Lawyers profile can be viewed here.

Partner Philip Fairbanks is also a Top 100 National Trial Lawyer!

Philip’s National Trial Lawyers profile can be viewed here.

The National Trial Lawyers is a professional organization composed of the premier trial lawyers from across the country who exemplify superior qualifications as civil plaintiff or criminal defense trial lawyers.

If you have an insurance claim or questions regarding a potential legal claim, call us today for a free consultation: (859) 225-3731. Any of our Partners are happy to speak with you!

Elizabeth is listed as a top rated Employee Benefits attorney in Lexington, Kentucky. Selections are determined on 12 indicators of peer recognition and professional achievement on an annual, state-by-state basis. Being named to the Rising Stars list is a prestigious distinction that only the top 2.5% of attorneys receive.

Why is there such a disparity in how physical and mental conditions are treated by disability insurance carriers? There shouldn’t be – and other types of coverage (such as health insurance) do not have this disparity. However, action is now being taken to try and make this change for disability policies. The 2023 ERISA Advisory Council has taken a focus on this very issue this year. Their goal has been to “study the scope and impact of employee benefit plans’ limitations on disability benefits for mental health and substance use conditions.”

The ERISA Advisory Council has now urged Congress to pass legislation for mental health parity in disability policies. And, since this news, a large disability insurance carrier – Sun Life – has vocalized support for mental health parity. Sun Life, in a press release, stated:

There is a mental health crisis in America. Benefits designed 75 years ago and continued as a market tradition do not reflect today’s reality. We encourage others to join us in supporting efforts to evolve disability coverage to meet the current needs of American workers. We must do the right thing and ensure we are covering the conditions that need to be covered, so that workers can get the support and assistance they need. Getting people back to health and back to work whenever possible remains the goal, and providing good mental health benefits to bridge people through times when they can’t work is a good investment.

Support such as this is significant and cannot be emphasized enough. Mental health conditions should be given the same priority and review that physical conditions are given under ERISA disability policies. A known long-term disability insurance carrier supporting this legislation makes us hopeful there will be a shift in the future. All conditions and disabilities deserve the same recognition and protection – and disability insurance carriers should join the ERISA Advisory Council and Sun Life by recognizing that mental health matters and a change is needed to protect the American citizens that are provided this coverage with the belief that they will be protected long term in the event of any disability.

You can read the 2023 ERISA Advisory Council notice, as well as the Sun Life press release statement by clicking the links above.

If you have an employee benefit plan and questions regarding your coverage, call us today for a free consultation: (859) 225-3731. Any of our Partners are happy to speak with you!

An experienced Kentucky ERISA disability lawyer can explain why disability insurance and other forms of insurance that are provided through your employer or union fall under a federal law known as The Employee Retirement Income Security Act of 1974, or “ERISA.”

Like many other employee benefits, ERISA disability law is designed to protect employees who have paid for or been promised these benefits through their employer. These benefits include:

• Long term disability insurance
• Life insurance
• Health insurance
• Accidental death, dismemberment or disability insurance
• Vision and dental insurance
• Long-term care insurance

Call us, or request a free claim evaluation today. We are here to help.

Frequently Asked Questions on ERISA Disability

1. What Should I Do Before I File an ERISA Disability Claim?
2. What Should I Expect After Filing an ERISA Disability Appeal?
3. What Happens if My ERISA Disability Appeal Is Denied?

What Should I Do Before I File an ERISA Disability Claim? If you are considering filing an ERISA disability claim or if you have already applied but your ERISA disability claim has been denied, the best thing to do is speak to our experienced Kentucky ERISA disability lawyers. Our experienced ERISA disability attorneys can help you with your case and ensure that the insurance company does not play games with you. It is a good idea to get an experienced ERISA disability lawyer involved early in your case. Our ERISA disability lawyers will not charge you anything upfront to help you, so there is no reason to delay seeking their advice.

If you have been denied ERISA benefits, it’s important to understand that ERISA rules are different from regular insurance and court rules. One of the special rules about ERISA cases is that the person applying for benefits must get all the information in to support his or her case before the insurance company of the plan makes a final decision. Otherwise, that information will not be considered by a court later, if the claim is denied. Also, the rules in ERISA cases usually give the insurance company or decision-maker the benefit of the doubt in court, so that knowing what information to submit is crucial to successfully obtaining ERISA benefits.

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What Should I Expect After Filing an ERISA Disability Appeal? Insurance companies are required by ERISA regulations to establish and maintain a procedure for appealing a claim after it has been denied. Your plan should tell you how many appeals must be filed before you may file a lawsuit, but the insurance company cannot require more than two. Each appeal should be handled by a different person from the insurance company to ensure a full and fair review of your appeal. It is extremely important to submit the complete documentation supporting your case during the ERISA disability appeal process. Only the documentation submitted during the appeal becomes part of what is known as the “administrative record”.

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What Happens if My ERISA Disability Appeal Is Denied? If your ERISA disability appeal is denied, then a lawsuit may be filed. ERISA trials are decided only by a judge. There are no jury trials for ERISA claim denial cases. The judge, in most cases will only review the administrative record, and no witness testimony is heard at the trial. That is why it is so important to get everything necessary to prove your case in during the ERISA appeal process.

Our experienced ERISA disability lawyers can help you during every phase of the ERISA claim and appeal process. We can ensure that all vital information is submitted and that all of the filing deadlines are met on time. We will fight to protect your rights, and we will work hard to get you the benefits you deserve.

Call us, or request a free claim evaluation today. We are here to help.

Ralph Gragg worked for UPS as a driver hauling freight for approximately thirty years. When UPS decided to reclassify Mr. Gragg’s position, he transitioned from being a nonunion worker to a union worker. With his new classification status, his pension plan would then be funded by two distinctly different pension plans that existed within UPS. Each pension plan had a “Social Security Leveling Option” that would “increase the beneficiary’s monthly benefit before age 65 and thereafter reduce it by the amount of his Social Security benefit.” Gragg v. UPS Pension Plan, 55 F.4th 1059, 1061 (6th Cir. 2022). Mr. Gragg selected the “Social Security Leveling Option” for both of his pension plans. Each plan sent Mr. Gragg a letter that indicated what his payments would be before and after receiving his Social Security benefit. Each plan indicated that his monthly payment would be reduced by $1754 (the anticipated amount for his Social Security benefit).

However, when Mr. Gragg retired and began collecting his Social Security benefit each plan was reduced by his Social Security benefit for a combined total of $3508. When Mr. Gragg inquired about the discrepancy with each plan individually, they both responded with complicated messages that, in the end, indicated that the “reduced benefit amount was the correct amount.” Id. So, in November of 2020 Mr. Gragg filed a lawsuit against the UPS Pension Plan. He asserted a claim under the Employee Retirement Income Security Act, 29 U.S.C. § 1132 (a)(1)(B), that alleged that both pension plans paid him less than he was entitled to each month. Namely, $1754 less due to both plans being reduced by that exact amount.

The District Court for the Southern District of Ohio originally dismissed his claim. The lower court based their rationale on the timing of Mr. Gragg’s claim. The district court posited that Mr. Gragg was told about the reductions ten years prior to his suit. Thus, the time has passed for Mr. Gragg to seek a remedy from the courts. However, the Sixth Circuit Court of Appeals disagreed. The limitations period for an ERISA claim “to recover benefits due” under a plan does not expire before the alleged underpayment on which the claim is based. Id. Even though each plan did in fact notify Mr. Gragg about the anticipated payments he should receive before and after collecting his Social Security benefits. He was not “injured” in the eyes of the law until he received the first underpayment. Before the alleged underpayment occurred, Mr. Gragg would not have had a claim that would be viewed as justiciable under Article III of the Constitution. Id. at 1062. The 6^th Circuit explained there is a difference between a ”dispute” and an “injury” in terms of a claim accruing. Id. Therefore, Mr. Gragg’s claim was timely, and he may now argue against having his pension plans reduced by $3508.

If you have questions about your pension plan or have experienced a situation similar to Mr. Gragg, call us today at (859) 225-3731 or visit us here to request a free consultation with one of Mehr Fairbanks’ attorneys.

*The information contained within this post should not be considered legal advice or legal representation.