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What is the ERISA Statute of Limitations?

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What is the ERISA Statute of Limitations?

30 Apr, 2019
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If there is one bedrock principle of law, it is this: An injured party does not have forever to sue. Instead, the law forces those who are injured to get to court and file a lawsuit to protect their rights in a timely manner. The maximum amount of time they have to sue is found in the relevant “statute of limitations.”

ERISA has a complicated statute of limitations, which can leave people confused about the amount of time they have to sue. Contact an experienced Chicago ERISA attorney as soon as possible if you feel that your rights have been violated.

Statute of Limitations for Fiduciary Duty Claims

Fiduciaries, like retirement plan trustees, have certain duties imposed by the law, such as the duty to manage the plan for the exclusive benefit of the plan participants and not to engage in self-dealing. Any violation could result in a lawsuit.

ERISA Section 413 contains the statute of limitations for the breach of fiduciary duty claims:

  • Six years after the date of the last action that makes up the violation or, if the breach was an omission (failure to act), then six years after the latest date the fiduciary could have cured the breach; or
  • Three years after the date when the injured party had actual knowledge of the breach.

The deadline is the earlier of the two. For example, if Mary had actual knowledge that her plan trustee engaged in self-dealing on June 1, 2016, then she must bring a lawsuit before June 1, 2019. If she had no actual knowledge, then she gets six years from the date of the last self-dealing.

Statute of Limitations for a Section 501(a)(1)(B)

Not every claim is a breach of fiduciary duty claim. For example, you might have an employer-sponsored group disability insurance policy. If your claim is denied unfairly, you can sue to receive your benefits under § 502(a)(1)(B) of ERISA.

This type of claim actually has no federal statute of limitations. Instead, if you bring a lawsuit in Illinois, the court must use the statute of limitations for the closest state action. In Illinois, this is probably a dispute involving a written contract, which has a 10-year statute of limitations.

There is an interesting wrinkle: As the Supreme Court has recognized, you can agree in the contract to a shorter limitation period, which will be upheld by a court. So if you agree to a three-year limitations period, then this is what a court will likely enforce. A court will only refuse to enforce a contracted imitation if it is unreasonable.

Obtain the Benefits You Deserve

If you have unfairly been denied health care, disability, or other employer-sponsored benefits, then you should meet with a Chicago ERISA attorney to discuss your rights. You might need to bring a lawsuit in court.

Michael Bartolic has practiced in this area of law for years and has helped many employees obtain the benefits they are entitled to. Avoid delay. You can call our office or submit an online contact form.

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