Many employers in Minnesota establish retirement plans for their workers as a part of their benefits packages. While companies are not required to offer these, if the plans are available, there is a federal law that regulates them. According to the U.S. Department of Labor, this law is known as the Employee Retirement Income Security Act of 1974.
An employee who is contributing money to a pension plan has certain rights under this law. For example, the Pension Benefit Guaranty Corporation will pay some of the benefits if a plan is terminated. How the benefits are accumulated and the employee’s rights to them are outlined in ERISA, as well. Vesting, funding and participation rules should be included. Employees must be informed about their plans, although the materials may not all be provided at no cost to the worker.
Most employers offer plans that are overseen by fiduciaries, and ERISA provides guidelines for these trustees to prevent them from acting outside of the employee’s best interests. If a fiduciary is responsible for acting unethically and losing an employee’s money, he or she may be sued and held personally liable for the losses.
According to the Internal Revenue Service, when a plan participant dies, the surviving spouse may be entitled to receive some or all of the pension benefits. The spouse may be able to rollover the funds into an existing retirement account, or the benefits may be available as installment payments or a lump sum. These details vary based on issues such as the annuity starting date and what kind of plan it is. This information can be found in the summary plan description.