ERISA, Pensions and Social Security
The Employee Retirement Income Security Act of 1974 (“ERISA”) is a federal law that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans. ERISA protects the interests of employee benefit plan participants and their beneficiaries by:
- requiring the disclosure of financial and other information concerning the plan to beneficiaries;
- establishing standards of conduct for plan fiduciaries; and
- providing for appropriate remedies and access to the federal courts.
Read the Law: Pub.L. 93–406, 88 Stat. 829, enacted September 2, 1974, codified in part in U.S. Code, Title 29, Chapter 18
ERISA gives spouses and divorced spouses some rights in a worker’s pension plan. ERISA requires that pension benefits paid at normal retirement age take the form of a joint and survivor annuity. A joint and survivor annuity is a benefit paid during the lifetime of the worker, with a survivor benefit to one other person, usually the spouse. The marriage must have lasted for at least one year for a divorced spouse to qualify for survivor benefits.
Read the law: U.S. Code, Title 29, § 1055
At the time of divorce, a pension may be considered marital property and subject to division if it was earned during the marriage. If the parties or the court divide pension assets at the time of a divorce, they do so by creating a qualified domestic relations order (QDRO).
Even after you divorce your spouse, you may receive Social Security retirement or survivor’s benefits based on the record of your former spouse if you were married to the worker for at least ten years before a final divorce. However, to receive benefits, the law requires that you are:
- at least 62 years old;
- your ex-spouse is entitled to Social Security retirement benefits; AND
- not entitled to higher retirement or disability benefits on your own record.
Read the law: U.S. Code, Title 42, § 416
If you remarry, you generally lose your rights to the benefits based on your former spouse’s record unless your later marriage ends (e.g., divorce, death, annulment). If your former spouse dies, you may be entitled to survivor’s benefits if your marriage lasted 10 years or more, you are at least 60 years old, and you have not remarried before age 60. Learn more about applying for Social Security Benefits.
Read the law: U.S. Code, Title 42, § 402
The Railroad Retirement system is a separate retirement program for railroad workers. Instead of participating in the Social Security system, railroad workers participate in the Railroad Retirement system. Tier I benefits under the Railroad Retirement Act follow the same rules for divorced spouses that are described above for Social Security benefits.
Read the law: U.S. Code, Title 45, § 231