Government Officials Teach Employee Benefits Law Class at Southwestern
On the cutting edge of innovative legal education, Southwestern is the only law school in the country to provide an Employee Benefits Law class taught by two investigators with the U.S. Department of Labor. Offered for the first time this summer, the course focuses on the Employee Retirement Income Security Act of 1974, or ERISA, which protects the assets of millions of people who work in the private sector, so that funds placed in retirement plans during their working lives will be there when they retire.
Professor James Goldstein, a Supervisory Investigator with the U.S. Department of Labor Employee Benefits Security Administration (EBSA) and Professor Dina Yadegarian, a Senior Investigator with the agency, serve as the class instructors.
"The U.S. Department of Labor is made up of a lot of different agencies for enforcement of different statutes. We (EBSA) are one of those agencies," Professor Goldstein said. "We are reaching out to teach these courses in the hope of encouraging people to think about this area of the law and maybe even inspiring them to eventually come work for us."
On July 12, the class welcomed Phyllis Borzi, the U.S. Assistant Secretary of Labor, as a guest speaker. In her position, Ms. Borzi oversees approximately 707,000 private-sector retirement plans, approximately 2.5 million health plans, and a similar number of other welfare benefit plans that provide benefits to approximately 140 million people. As agency head, she spearheads the administration, regulation and enforcement of Title I of ERISA.
With the recent U.S. Supreme Court Decision to uphold the Affordable Care Act, the new health care law will cause ERISA to experience some changes. "This is an exciting time to get in on the ground floor of this kind of practice of law," Ms. Borzi explained. "No senior partner [in a firm] could claim to have more experience in this area of law than you because it's so new."
Professor Goldstein, an attorney who has been with the EBSA for nearly 11 years, said that ERISA is important for law students to study because it intersects with a lot of other areas of the law including securities, banking, tax and family law. "Whether they choose to practice in this area or not, the most important thing for students to learn in this course is that employee benefits law affects everyone," he said. "Most people are going rely on a plan for retirement savings or health care in addition to anything else that may be offered by their employers. It's good for everyone to know."
ERISA, which was enacted in 1974, governs how employee benefits plans are effectively administered by three agencies, each with jurisdiction over specific parts of the statute, Professor Goldstein explained. The Department of Labor primarily interprets and enforces Title I, which contains the reporting and disclosure and fiduciary provisions of ERISA; the IRS oversees Title II, the tax qualified status, which ensures that retirement plans such as 401(k) or 403(b) plans are not going to be taxed or that the insurance benefits employees received aren't taxed; and the Pension Benefit Guaranty Corporation (PBGC), oversees Title IV of ERISA, which set up the PBGC-run insurance program for traditional pension plans (also known as defined benefit plans).
The course, which meets twice weekly, specifically emphasizes Title I of ERISA, which was enacted to address public concern that funds of private pension plans were being mismanaged and abused. ERISA was the culmination of a long line of legislation concerned with the labor and tax aspects of employee benefit plans. Prior to ERISA, the longtime automobile maker Studebaker went out of business. Workers who had been with the company for decades lost their retirement money. (These were the days before 401(k) plans.) With the passage of ERISA, the PBGC program ensures that another scenario like the one at Studebaker doesn't happen again.