Source: https://www.lowandcanata.com/erisa-by-topic/plan-sponsors-participants-and-beneficiaries-in-erisa-disability
Timestamp: 2019-04-21 22:52:49+00:00

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A disability plan subject to ERISA is an “employee welfare benefit plan,” defined by federal statute at 29 U.S.C. § 1002(1) as “any plan, fund, or program…established or maintained by an employer or by an employee organization, or by both…for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) … benefits in the event of…disability…” On its face, then, an ERISA disability plan contemplates six possible players: employers, employee organizations, some combination of employers and employee organizations acting jointly, participants, beneficiaries and insurers.
Plans are established by a “plan sponsor,” defined at § 1002(16)(B) as “(i) the employer…(ii) the employee organization…or (iii) in the case of a plan established or maintained by two or more employers or jointly by one or more employers and one or more employee organizations, the association, committee, joint board of trustees, or other similar group of representatives of the parties who establish or maintain the plan.” These plan sponsors benefit indirectly from the plan: participation in the plan is a benefit that they use to attract and retain valuable employees or, in the case of an employee organization like a union, to provide value to their members.
The plan sponsor is not necessarily the entity that administers the plan. This is because an employer or employee organization is not in the business of providing disability benefits, and may therefore choose to outsource the administration of the plan to some other business. The ERISA statute defines the plan administrator at § 1002(16)(A) as “(i) the person specifically so designated by the terms of the instrument under which the plan is operated; (ii) if an administrator is not so designated, the plan sponsor; or (iii) in the case of a plan for which an administrator is not designated and a plan sponsor cannot be identified, such other person as the Secretary may by regulation prescribe.” The Secretary has prescribed by regulation that where the plan sponsor cannot be identified, the plan sponsor is the administrator. 29 CFR §2510.3-16.
In addition to defining what entities create, maintain and administer ERISA plans, the ERISA statute defines those for whom such plans are created, maintained and administered. Plans are established or maintained for the benefit of “participants,” defined at §1002(7) as “any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit.” A beneficiary is defined at §1002(8) as “a person designated by a participant, or by the terms of an employee benefit plan, who is or may become entitled to a benefit thereunder.” Since disability benefits are designed to benefit the employee directly, there are no beneficiaries eligible to receive benefits of disability plans other than the employees themselves.
The ERISA statute, as you can see, meticulously defines the roles of plan sponsor, administrator, participant and beneficiary. Having done so, it then ignores them in defining who is a fiduciary, opting instead to create a functional test. A fiduciary can be any “person” exercising authority and control of assets or discretionary authority or responsibility in administering the plan. The takeaway for all of the above if you have an ERISA disability plan is this: though you may be talking to someone in the human resources department where you work, a “disability claims specialist” for the insurer of the plan or some other person, their role and their duties are informed by an intricate legal web.

References: § 1002
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 §2510
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