In the 1950s, Congress began studying welfare and pension funds covered by collective bargaining agreements. After years of hearings, it concluded its studies and investigations with the following:
The most serious single weakness in this private social insurance complex is … the too frequent practice of withholding from those most directly affected, the employee-beneficiaries, information which will permit them to determine (1) whether the program is being administered efficiently and equitably, and (2) more importantly, whether or not the assets and prospective income of the programs are sufficient to guarantee the benefits which have been promised to them.
S.Rep.No. 1440, 85th Cong., 2d Sess., 12 (1958); see Malone v. White Motor Corp. 435 U.S. 497, 5061 (1978).
By the time ERISA was enacted in 1974, Congress still wanted to address related problems: “Congress’ primary concern was with the mismanagement of funds accumulated to finance employee benefits and the failure to pay employees benefits from accumulated funds.” California Div. of Labor Standards Enforcement v. Dillingham Const., N.A., Inc., 519 U.S. 316, 326-327 (1997). In order to advance those goals, ERISA “established extensive reporting, disclosure, and fiduciary duty requirements to insure against the possibility that the employee’s expectation of the benefit would be defeated through poor management by the plan administrator.” Id.
Though this particular congressional interest seems to say that plan administrators must be kept from harming individual participants, the truth is that this interest focused on the plan as a whole, rather than individual claimants: “A fair contextual reading of the statute makes it abundantly clear that its draftsmen were primarily concerned with the possible misuse of plan assets, and with remedies that would protect the entire plan, rather than with the rights of an individual beneficiary.” Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 142 (1985). But see LaRue v. DeWolff, Boberg & Associates, Inc. 128 S.Ct. 1020, 1025 (2008) (“our references to the ‘entire plan’ in Russell, which accurately reflect the operation of § 409 in the defined benefit context, are beside the point in the defined contribution context”). Regardless of whether Congress was focusing on the plan as a whole or individual participants, one can certainly expect claimants to argue that upholding their claim in full will be advancing this policy interest.
This is only part of the Congressional policy story, however. Congress was concerned not only with ensuring that employees got the benefits they were promised, but also with encouraging employers to promise...
