The ERISA [Employee Retirement Income Security Act] Industry Committee (ERIC) today filed a complaint in the U.S. District Court for the District of Oregon against the Oregon Retirement Savings Board for obstruction of the Employee Retirement Income Security Act (ERISA). In the complaint, ERIC requests an injunction against the reporting requirement OregonSaves imposes on employers that provide a retirement plan.
OregonSaves is Oregon’s state-run retirement program, signed into law in June 2015. The Oregon Retirement Savings Board was implemented and tasked with creating a defined contribution (DC) retirement plan for private-sector employees. The result was OregonSaves.
The state started with a pilot program this July, and, beginning November 15, employers not involved with the pilot programs will be required to begin registering, based on their size.
In the lawsuit, ERIC argues that ERISA pre-empts the reporting requirements in OregonSaves. The state law requires large employers that already provide a retirement plan to formally request an exemption, completing paperwork every three years to retain the exemption from the state mandate. But reporting on plan activities is a core ERISA function governed exclusively by federal law, ERIC says.
“Oregon is reaching beyond what the federal law allows by imposing a compliance burden on employers that voluntarily provide a retirement plan to their employees,” says Annette Guarisco Fildes, ERIC president and CEO. “This approach not only violates federal law, but is counterproductive as it will add unnecessary costs and burdens on employers that are doing exactly what policymakers across the country want them to do—helping their employees save for retirement with an employer-sponsored retirement plan.”
ERIC’s mission since 2015 has been to ensure that state and local laws do not adversely affect employers providing health and retirement benefits to participants and their families.
Why sue Oregon and not other states that have passed similar legislation? Oregon is the first to implement its state-run retirement program, and ERIC believes it is important to protect ERISA-qualified retirement plans. Oregon, due to the final rules the state implemented, provides the first opportunity to present such arguments regarding why states should not infringe on an employer’s ability to provide a retirement plan to employees—from both a legal and public policy perspective, the association explains.
To read ERIC’s complaint, click here.