The Employee Retirement Income Security Act—ERISA—was the hot topic at an employee benefits conference in the fall of 2024, marking 50 years since its passage. Held at the Catholic University of America, which co-sponsored the event with Boston College Law School and the University of Michigan’s Ross School of Business, it convened scholars across various disciplines to discuss the legislation’s strengths and shortcomings, and to consider proposals for future reform. Associate Professor Natalya Shnitser, the David and Pamela Donohue Faculty Fellow at Boston College Law School, who co-organized the event, spoke with BC Law Magazine about ERISA’s significance and the state of employee benefits laws at that time.
The interview was conducted by Isabella Burrell ’25.
Can you provide a brief background about the current state of employee benefits law, specifically focusing on ERISA?
ERISA turned 50 years old in 2024, so we’ve had this legal experiment in our employee benefits system for five decades now. And even as the nature of benefits, demographics, and economic conditions have changed, the law has remained largely the same.
What are some of the challenges at the forefront of ERISA?
First, over time, there’s been a shifting of risk and responsibility onto individual workers in the United States. It’s unclear whether the law does enough to protect workers and equip them with the necessary financial literacy and education appropriate for the decisions they now have to make in the retirement space.
Second, we have a system in the United States in which employers have a unique and outsized role in the financial lives of their employees. This begs the question: Is the employer the right intermediary for deciding whether to offer these benefits or for providing oversight?
Third, on the retirement side, is the nature of the investments. There’ve been a lot of changes in the types of investments that workers can access. Increasingly, I’m focused on the tradeoffs inherent in newer kinds of investments that haven’t received a lot of attention, including vehicles like collective investment trusts.
How do healthcare benefits fit into the current regulatory regime?
ERISA covers employer-sponsored medical benefits and actually preempts a lot of state laws that might otherwise regulate employer-sponsored health insurance. In 1974, the drafters of ERISA weren’t really focused on health insurance. As a result, ERISA preempts state law but historically hasn’t offered a lot of substantive regulation of employer-sponsored health insurance benefits. Therefore, a big focus in this space is on the cost and quality of employer-sponsored health insurance.
Where does one look for ideas on how to improve employee benefits?
Well, the US is not alone in facing some pretty significant challenges to its retirement system. It’s been interesting to see all kinds of pension reform efforts around the world. There is a lot of opportunity to learn from what’s happening across different states, from innovations in the private and public sector, and also from what is happening around the world.
Can you identify some of the biggest economic and demographic shifts that you think have impacted ERISA?
I think a lot has changed in the last five decades. First, when ERISA was enacted in 1974, a lot of the employers that offered any kind of retirement plans tended to offer more traditional defined-benefit pensions. Over the last five decades, we’ve shifted toward a state in which the vast majority of employers that offer benefits offer 401(k)-type defined contribution plans. Thus, the obligations of the employer are now considerably more limited.
Second, the nature of work has changed. People are living longer and planning for potentially decades of non-working life. People may also work for shorter periods of time, so the average tenure has gone down. What happens to benefits when people are jumping from job to job? Things like the growth of the “gig economy” and the lack of coverage for independent contractors is certainly another challenge.
And the last piece is healthcare. The rise of health insurance costs has been felt by employers and employees. Employers are in the middle of making critical choices about what to cover. There are big questions that remain about the regulation of healthcare and ERISA’s role in it.
Those are substantial shifts. Have you seen any direct attempts to modify ERISA to address those changing conditions?
I think there have been piecemeal efforts, but less by way of comprehensive reform thus far. For example, there were some attempts at reform with the Pension Protection Act in 2006 and the Secure Act in 2019. The Affordable Care Act impacted health insurance, including employer sponsored health insurance, in 2010.
Why hasn’t there been more of an overhaul effort in your opinion?
It’s helpful to remember that it took at least a decade to get to the enactment of ERISA in 1974. There are approximately $40 trillion in in assets in the US retirement system, which means there are a lot of different stakeholders, including plan participants, employers, asset managers, financial institutions, and all kinds of other service providers.
I want to touch on the point you made about the wide range of interests at stake. The scholars who were involved in your conference come from such different educational backgrounds. Can you speak to how a lawyer fits into employee benefits law?
The role of lawyers is a significant one, and I think two issues stand out. First, lawyers help employers and service providers navigate the complex regulatory regime that has evolved under ERISA over the last 50 years.
Second, lawyers have played a significant role in enforcing various provisions of ERISA and helping to bring about legal and regulatory changes. ERISA litigation has put a spotlight on the fiduciary obligations of those who administer employee benefit plans and have discretion over plan assets. Over the years, certain retirement plan fees have decreased, and plan governance has become more formalized.
Given some of the roadblocks you’ve addressed, do you think that lawyers’ individualized services in bringing these lawsuits might be an effective way to change the current scheme?
I think litigation obviously has shortcomings, but ERISA lawyers continue to play a really important role in clarifying and enforcing the obligations of ERISA fiduciaries in the administration and oversight of both retirement and health insurance plans.
How do you think that the law could best adapt to some of the changes you’ve identified in US affairs?
What we have seen over the last decade is a lot of experimentation to address challenges with access, coverage, and cost. This is happening with various state-led efforts to require small employers that don’t offer plans to enroll their workers in state-administered plans for private sector employees. What if there are ways to help those smaller employers pool resources or workers, and outsource some administration and compliance work to third parties? This is all to say that I think we need is more research to assess these experiments and outcomes in a systematic way. so that we can learn from these policy experiments.
What are some courses or activities that you would recommend for BC Law students who are interested in learning more about these issues?
Employee benefits law, which I offer as a course at BC Law, implicates and intersects with tax law, corporate law, health law, employment and labor law, family law, trust & estates law, and bankruptcy law. In terms of other experiences, we’re fortunate to be in Boston where there are a lot of opportunities for students to gain more on-the-ground experience. I’ve had a number of students work at the Department of Labor’s Boston office and at the Pension Action Center, which is affiliated with the University of Massachusetts.
What drives you as a professor? How do you bring this excitement about complicated areas of law into the classroom?
I see employee benefits everywhere I look. The material that I teach in class impacts our daily lives. In my course, I we work through the statutes and the case law while also engaging with the legal and policy debates that are playing out around us. We keep track of current developments and discuss how the actions of different employers, regulators, the courts, and Congress implicate the material covered in class. I think this brings the material to life and helps all of us appreciate the impact of the law.
Photograph by Caitlin Cunningham