Originally published in Student Lawyer ,
December 2002 (Vol. 31, No. 4)
By LISA STANSKY
Employee benefits lawyers protect the interests of workers
and their employers
If you haven’t thought much about employee benefits law, think
about this: legions of Enron workers who watched their retirement savings go up
in smoke. The practice may seem low profile, but the issues make front-page
news.
One acronym sums up employee benefits law—ERISA. These five
letters stand for the Employee Retirement Income Security Act of 1974, the
federal statute that is the bible for lawyers who approach the specialty from
every conceivable angle. The law comes into play if an employer offers employee
benefits such as health insurance,
pension plans, life insurance, and severance packages.
Employee benefits lawyers say their field offers lots of variety and personal satisfaction. The
specialty covers transactional as well as litigation aspects of practice. It
provides opportunities to represent workers as well as their employers.
“It’s a fun area,” says Nell Hennessy, chair of the ABA
Section of Business Law’s employee benefits and executive compensation
committee. “The law changes once a year or sometimes more than once a year.”
Hennessy outlines ERISA’s most relevant aspects as follows.
One aspect involves issues such as employer disclosure requirements and
fiduciary responsibilities, along with remedies available for violations of the
law. Another element of ERISA sets the minimum requirements pension plans must
adhere to in order to receive favorable tax treatment. Finally, the statute
establishes rules that govern what an employer must pay if it terminates or
withdraws from a plan. It also covers the contingencies that arise in the event
of an employer’s bankruptcy.
Hennessy, president of Aon Fiduciary Counselors Inc. in
Washington, D.C., says her work has touched on all of these broad areas. Even
for those lawyers with a pure tax law or securities law practice, she says, ERISA issues are likely to arise.
For example, Hennessy points out that more than a quarter of all U.S. stock is
held by private and public pension plans, which are governed, of course, by
ERISA.
How do lawyers divvy themselves up among the various aspects
of employee benefits law? For the most part, there are distinct litigation and
transactional sides of the practice. The same generally applies to the
employer-employee sides of the fence.
The good news for those seeking employee benefits work is
that most large firms have a practice section devoted to the field. Some
boutique firms focus on ERISA work as well.
Most firms are likely to represent employers, but AARP
senior staff attorney Mary Ellen Signorille says lawyers can develop a
plaintiff-side (i.e., employee-focused) practice with a strong investment of
diligence and patience. “People have done it and done it successfully,” says
Signorille, co-chair of the employee benefits committee of the ABA Section of
Labor and Employment Law.
Even while in law school, aspiring employee benefits lawyers
can take advantage of the fact that ERISA law changes frequently. Students can
make an effort now to keep abreast of new developments and market themselves
as having cutting-edge knowledge of where the law is going, says Washington,
D.C., lawyer David Levin, Signorille’s co-chair. Levin points to new privacy
regulations governing employee health information as a good example of an area
students can dive into now. “The regulations are huge,” he says. “It’s like
a book.”
Where the jobs are
Levin
advises that students look for job opportunities in the field with governmental
entities that handle insurance, labor, or tax issues. At the state level, he
says, students can identify the governmental unit that oversees the insurance
industry. And at the federal level, students can look into regional or local
offices affiliated with either the U.S. Department of Labor or the Internal
Revenue Service.
Another angle of employee benefits law is taxation, which
Phoenix lawyer Thomas Hoecker finds personally rewarding. The practice “offers
an opportunity to help structure programs that benefit the employee and the
employer,” says Hoecker, chair of the ABA Section of Taxation’s employee
benefits committee. He points out that companies seek favorable tax treatment
and need to make sure they’re in step with ERISA requirements to do so.
If you’re not comfortable dealing with tax issues at least
some of the time, ERISA might not be for you, says Philadelphia lawyer Robert
Abramowitz, chair of the ABA Health Law Section’s employee benefits and
executive compensation committee. What he likes about his practice is that the
client’s goal is clear: providing benefits to workers within the company’s
fiscal parameters. Abramowitz represents mostly employers, including
governmental agencies and nonprofit organizations such as hospitals and health
systems.
By contrast, C. Mark Humbert doesn’t approach employee
benefits issues from the “ERISA guru” perspective characteristic of tax
practitioners. “My particular niche really is litigation,” says Humbert, who
chairs the employee benefits committee of the ABA Tort Trial and Insurance
Practice Section. The Walnut Creek, Calif., lawyer advocates on behalf of
insurers and other plan-related entities.
New York lawyer Gloria Nusbacher, the Business Law Section’s
representative to the ABA Joint Committee on Employee Benefits, is drawn to the
executive compensation and securities law aspects of the practice. Part of the
challenge comes from trying to parse the requirements of a host of laws and
regulations in addition to ERISA, such as federal securities law.
A big issue today, she says, is whether corporate
compensation committees are rubber stamping rather than scrutinizing executive
compensation packages, some of which provide homes and huge stock deals to
high-level corporate officers. Part of her work is to advise compensation
committees on such matters.
Even if employee benefits law and its leading acronym aren’t
on your personal radar screen, know that it’s something with a market. As Abramowitz
says, “Virtually every firm that does corporate work needs to either have ERISA
capability or an arrangement with a firm that has ERISA capability.”
Lisa Stansky (nolawritestuff@cs.com)
is a lawyer and freelance writer in New Orleans.
Resources on Employee Benefits Law
A good place to begin is the Joint Committee on Employee Benefits (www.abanet.org/jceb),
which coordinates the activities of the employee benefits committees of six
ABA sections. Visit the web sites of each section to learn about practice-related
developments, educational and networking opportunities, activities for law students,
and other membership benefits.
The Section of Business
Law (www.abanet.org/buslaw)
has a committee on employee benefits and executive compensation. Section members
receive a subscription to The Business Lawyer, a student-edited law
journal, and Business Law Today, the
section magazine. Membership is free for law students.
The Health Law Section
(www.abanet.org/health) has a committee on employee
benefits and executive compensation. Students can join the section for $10 and
receive a subscription to The Health Lawyer.
The Section of Labor
and Employment Law (www.abanet.org/labor) has
an employee benefits committee. Section membership is $3 a year for law students
and provides subscriptions to The Labor
Lawyer and The Labor and Employment
Law Newsletter.
The Section of Real
Property, Probate, and Trust Law (www.abanet.org/rppt)
has a series of committees under the rubric of “employee benefit plans and other
compensation arrangements.” Students can join the section for $5 and receive
Probate and Property magazine and Real Property, Probate, and Trust Journal.
The Section of Taxation
(www.abanet.org/tax) has an employee
benefits committee. A $6 annual section membership for law students provides
subscriptions to The Tax Lawyer journal, The State and Local Tax Lawyer journal,
and the section newsletter.
The Tort Trial and Insurance
Practice Section (www.abanet.org/tips)
has an employee benefits committee. Students can join TIPS for free and receive
three periodicals: the Tort and Insurance
Law Journal, The Brief, and The Source.
To join an ABA
section, call 800-285-2221.