Known adoringly as the WPPDA, the Welfare and Pension Plans Disclosure Act was created in the 1950s, and gave the U.S. Department of Labor authority to regulate the benefits of employees at private companies. It required employers (and labor unions) to give the Department of Labor reports and summaries of their benefits plans to make employers accountable for what they’re promising workers.
Not getting your benefits is just as bad as your employer paying you less than you agreed upon. Giving the Department of Labor the power of transparency and the ability to investigate wrongdoings is a way of protecting workers.
But the WPPDA is now history, since it was replaced by the Employee Retirement Income Security Act (ERISA) in the 1970s. ERISA expanded on WPPDA, requiring businesses to provide pension plan participants with plan information and features, and regularly update them free of charge. ERISA also has a backup plan for when employers do screw over their workers (in some cases) with benefits from a federally chartered corporation.
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Finance: What is a Pension?31 Views
finance a la shmoop. what is a pension? well it rhymes with tension, and likely
for good reason. if you're a teachers pension or a fireman's pension or [person wearing dark glasses writes something down]
another state employees pension that's backed up by a state that's going
bankrupt. Hi, California, Hi Illinois. well we're looking at you. all right people
well a pension is another term for a retirement fund. but what's special about
a pension is that the employer essentially forces you to put away money
for your retirement and then they invested for you.
how nice. or at least be sure you invest it well on a salary of 75 grand a state [gambling table shown]
employed ditch-digger might get a contribution of say 10 grand a year into
her pension, and that's each year 10 grand of forced savings for as long as
she you know digs ditches for the state. and in some states where the unions are
strong in the governing financial knowledge is weak the government
guarantees a minimum financial return on the pension investment made on behalf of
the employees. that is in California for example the state guarantees a 10% per
year return on their invested pension savings. if the invested return like [equation]
investing it in Wall Street and stocks and bonds and private equity funds and
all that stuff well if that invested return is less than that number less
than that 10%, then the state rights to the pinch and a check to cover the
incremental difference. yeah it's a huge Delta and it's well pretty much why you
a Californian Illinois you're going bankrupt remember. Jesus Saves
but Moses invests. [ Moses, holding stone tablets glares and demands interest]
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