Celebrating 50 Years of ERISA

This year marks the golden anniversary of the Employee Retirement Income Security Act (ERISA), a landmark law that has played a pivotal role in shaping employee benefits in the United States.

Why it matters: For five decades, ERISA has provided large employers with a framework to offer secure, comprehensive health benefits to their employees. 

• ERISA’s preemption provisions enable self-insured businesses to offer uniform, tailored, and valued health benefits to their employees. Without this framework, employers would be subject to a patchwork of state requirements, making it increasingly difficult to design and uniformly administer health, welfare, and retirement benefits for employees and families.

• Its influence has ensured that millions of workers and their families have access to quality health care, financial security, and peace of mind.

Threats to ERISA uniformity: 

• State legislation: In the absence of federal reform on issues like PBM transparency, several states have enacted legislation which threatens federal preemption, requiring employers to navigate a patchwork of state laws.

• State litigation: A case in the U.S. Court of Appeals, Staffing Services Association of Illinois v. Flanagan, threatens ERISA preemption. It relates to an Illinois law which would require staffing firms to provide certain benefits to their temporary employees or make an equivalent cash payment to these workers. While the Seventh Circuit has defended ERISA preemption, the case will be appealed.

What’s next: HRPA submitted comments earlier this year to a House Education and Workforce Committee request for information on ERISA. We will continue to meet with relevant Committee staff to reinforce the importance of ERISA preemption and urge Congress to reject any proposals which weaken the law.