Balance the Scales Act
Balance the Scales Act would amend ERISA (the worker retirement security law) to increase transparency around what it calls “adverse assistance” in ERISA-related actions. Specifically, it requires the Department of Labor’s Employee Benefits Security Administration (EBSA) to enter into a written agreement with an individual before providing adverse assistance to that person and to share a copy of that agreement with any employer, plan sponsor, or fiduciary that could be directly affected. Adverse assistance is defined as guidance or information provided to aid an attorney in pursuing a civil action under ERISA. The bill also requires EBSA to publish an annual report to Congress detailing all such adverse-assistance agreements from the previous year, including copies of the agreements (with redactions), dates, and extensive logs of information-sharing, communications, and meetings, along with an explanation of how the agreement aligns with the public policy of promoting voluntary pension-plan sponsorship. The report must identify the parties to each agreement but may redact other identifying information. The act would apply to adverse assistance provided after enactment, with a mechanism to treat existing arrangements as already compliant if EBSA takes specified actions within 60 days. Additionally, a small policy statement would reaffirm that private pension plans are integral to retirement security and that voluntary establishment and maintenance of such plans should be encouraged.
Key Points
- 1Written agreement before adverse assistance: EBSA must enter into a detailed written agreement with the individual before providing adverse assistance, and a copy must be shared with any employer, plan sponsor, or fiduciary that could be affected.
- 2Definition of adverse assistance: Assistance or information directed specifically toward an attorney for potential use in an ERISA 502(a) civil action.
- 3Annual reporting to Congress: EBSA must produce an annual report (due within 60 days after enactment, then by December 31 each year) describing all adverse-assistance agreements, including copies (with redactions), dates, detailed descriptions of the assistance, logs of verbal communications and meetings, and an explanation of consistency with promoting voluntary plan sponsorship; identifying information must be included for the parties but redacted to protect others.
- 4Effective date and treatment of existing agreements: Applies to new adverse assistance after enactment; if EBSA acts for an existing arrangement within 60 days, that arrangement is treated as already compliant.
- 5Policy statement on retirement security: Adds a finding and policy emphasis that voluntary sponsorship and maintenance of pension plans are central to retirement security.