ERISA, Tax, and Employee Benefits

We pride ourselves on providing practical, “plain English” advice, meeting clients where they are and translating intricate legal requirements into manageable, forward-looking strategies. Whether a client is a Fortune 500 company redesigning its retirement platform, a private equity sponsor evaluating benefit obligations in a complex acquisition, a fiduciary looking to navigate a Department of Labor (DOL) or Internal Revenue Service (IRS) investigation, an emerging company looking to understand how a retirement plan can help optimize tax strategies, or a service provider to retirement plans concerned about running afoul of prohibited transaction provisions, our attorneys have the depth of experience required to deliver results. One thing that sets us apart from our competitors is the interdisciplinary background of our partners, who are skilled not only in ERISA but also bring deep expertise in the Code, insurance laws, and the securities laws — a combination that allows us to deliver efficient, strategic advice that accounts for the full regulatory picture rather than siloed advice.

Retirement Plans & Tax Qualification

Our practice has extensive experience advising on the design, implementation, administration, and compliance of tax-qualified retirement plans, including traditional and hybrid defined benefit plans such as cash balance and pension equity plans, as well as 401(k), 403(b), and profit-sharing defined contribution plans. We also help governmental agencies navigate the complexities of their retirement plans, including 457(b) plans. We guide clients through the full lifecycle of their retirement programs — from initial plan design and IRS qualification, through ongoing operational compliance, to plan amendments, mergers, terminations, and corrections. Our team routinely assists employers involved with IRS and DOL audits, investigations, and reviews, and we counsel plan sponsors on leveraging available correction programs to resolve compliance issues efficiently.

In the area of employee stock ownership plans (ESOPs), we advise organizations on the design, implementation, and administration of these powerful tools for business succession planning and employee ownership.

Executive Compensation & Nonqualified Plans

Our attorneys counsel public, private, and nonprofit clients on the full range of executive compensation arrangements, including executive employment agreements, severance arrangements, change-in-control agreements, top-hat plans, supplemental employee retirement plans or a “SERP,” short- and long-term incentive plans, the use of Rabbi trusts and deferred compensation plans subject to Section 409A of the Code. We have particular depth in cross-border and international executive compensation, advising multinational enterprises on the design, implementation, and regulatory compliance of global compensation programs, including the use of secular trusts and other vehicles to address the unique challenges of compensating executives across multiple jurisdictions. We also assist companies across a variety of industries— from development stages or start-ups to publicly traded enterprises — in designing, implementing, and administering incentive plans, with attention to the interplay of federal tax laws, securities regulations, financial accounting standards, and — for public companies — compliance with the Dodd-Frank Act and Sarbanes-Oxley Act corporate governance requirements.

Equity Compensation

Our attorneys work with publicly traded companies, mature private companies, companies owned by private equity firms and start-ups to design, implement, and administer traditional omnibus equity plans and bespoke equity and equity-based plans, bonuses and change of control arrangements with narrow goals in mind.

We routinely work with traditional stock-based awards such as incentive stock options, nonqualified stock options, restricted stock, exempt compensatory benefit arrangements under rule 701 of the Securities Act, and employee stock purchase plans. As new forms of equity such as stock appreciation rights and restricted stock units have grown mainstream, we routinely advise our clients with forward-thinking developments. Our advice covers the governing laws and standards applicable to these arrangements, including federal securities laws, state blue-sky obligations, financial accounting standards and the applicability of the Code.

As is the case with ERISA-governed plans, we assist companies in implementing and administering equity compensation arrangements by addressing administrative functions such as developing and drafting documents and policies that extend from dividing equity and awards upon the dissolution of a marriage to participant communications that provide participants with information in plain English designed to be easy to understand. We tailor administrative support in a variety of settings including the selection and retention of third-party administrators.

Tax-Advantaged Strategies & Wealth Planning

A distinguishing feature of our practice is its significant tax orientation. Several of our attorneys hold advanced degrees in taxation and have spent their careers at the intersection of ERISA and the Code, giving clients access to sophisticated strategies that go well beyond basic plan compliance. We leverage the full toolkit available under the Code and ERISA — including qualified retirement plans, ESOPs, nonqualified deferred compensation arrangements, split-dollar and key-man life insurance structures, and self-directed IRA and pension asset investments — to structure creative vehicles that enable tax deferral, elimination or reduction of future capital gains, and, in certain cases, the avoidance of ordinary income tax altogether. Our attorneys understand how plan asset money can be leveraged not only to build and enhance retirement wealth, but also to capitalize new business ventures and facilitate business succession planning in a tax-efficient manner.

This tax-focused perspective permeates every aspect of our practice, from advising emerging companies and C-suite executives on the optimal structure for deferred compensation and equity arrangements under Section 409A, to counseling plan sponsors on the tax qualification requirements of Sections 401(a) and 501(a), to guiding fiduciaries on structuring plan investments to maximize after-tax returns. Our attorneys bring to bear deep knowledge of the interplay among federal tax laws, ERISA’s fiduciary and prohibited transaction rules, federal securities laws, financial accounting standards, and applicable state laws — an interdisciplinary command that allows us to identify planning opportunities other practitioners may overlook.

ERISA Fiduciary Governance & Compliance

Managing fiduciary risk under ERISA is a core strength of our practice. We design governance structures that clearly delineate and compartmentalize fiduciary duties, train plan fiduciaries on their obligations, and provide ongoing monitoring support. Our attorneys advise employers, investment committees, investment advisers, third party administrators, agents, and financial service providers on ERISA’s fiduciary standards, prohibited transaction provisions, and plan administration requirements. This includes guiding fiduciaries through complex investment decisions and helping plans navigate the novel complexities associated with the expansion of ERISA plan assets into private markets. Fiduciaries are subject to unprecedented scrutiny around their investment selection and monitoring processes, valuation methodologies, liquidity considerations, fee structures, and disclosure practices. Drawing on expertise from the DOL and the SEC’s Division of Investment Management, our practice has firsthand experience with the regulatory frameworks, enforcement priorities, and rulemaking initiatives that shape fiduciary obligations in this space, insight that allows us to help clients build processes designed to withstand both regulatory examination and private litigation.

Health & Welfare Benefits

Our team advises employers, insurers, third-party administrators, and insurance agents and brokers on the full array of health and welfare benefit programs. We counsel clients on compliance with HIPAA, COBRA, the Affordable Care Act, the Mental Health Parity and Addiction Equity Act (MHPAEA), and other applicable federal and state laws. Our experience extends to sophisticated plan structures, funding approaches, and administrative issues – including complex corrective actions that relate to cafeteria plans, medical and dependent care flexible spending arrangements (FSAs), health reimbursement arrangements (HRAs), health savings accounts (HSAs), wellness programs, multiple employer welfare arrangements (MEWAs), association health plans, pooled employer plans (PEPs), self-funded health plans that rely on existing networks and reference based pricing models, and stop-loss coverage, captive insurance arrangements, health care sharing ministries, and tax-exempt VEBA trusts, including pre-funding retiree benefits such as retiree health.

Our team has also advised on high-stakes issues such as fraud committed against group medical plans that implicate various Federal laws and related authorities, a plan sponsor’s right to unilaterally modify group medical coverage for non-bargained and bargained workforces, which implicate the Yardman vesting presumption and broader strategies when bargaining with unions relating to welfare benefits more generally.

We also have deep knowledge of the insurance regulatory landscape, advising clients on product development and filings, state and federal insurance compliance, enforcement actions, and holding company act filings. Our attorneys leverage prior experience as in-house counsel at major insurers and health systems to bring a practical, business-minded perspective to regulatory challenges.

ERISA Litigation & Government Enforcement

Our litigators bring decades of experience representing plan sponsors, fiduciaries, financial service providers, insurers, fraternal benefit societies, agents, and third-party administrators in a wide variety of ERISA and benefits litigation in federal trial and appellate courts across the country. Our litigation capabilities encompass fiduciary breach claims, excessive fee litigation, ESOP disputes, Title IV and PBGC matters, life, health, and disability benefit claims under both ERISA and common law, healthcare claims arising under the Affordable Care Act and MHPAEA, HIPAA, stop loss and catastrophe health insurance disputes, and the prosecution and defense of complex insurance fraud and stranger-originated life insurance (STOLI) schemes. We also have significant government enforcement experience. Our team includes a former Litigation Counsel for the DOL’s Plan Benefit Security Division (the office responsible for handling ERISA litigation and advice), giving us an inside perspective of how DOL approaches enforcement matters. Our team has handled engagements before numerous federal courts of appeals and federal district courts. Our team also includes a former co-chair of the Life, Health, Disability & ERISA practice of a leading AmLaw 100 law firm, and our litigators are frequent speakers and authors on ERISA litigation topics, including disability claims, insurance fraud, rescission, and deposition practice.

Life, Health & Disability Litigation

Our Life, Health & Disability Litigation team brings more than 30 years of experience representing employers, insurers, fraternal benefit societies, and benefit plan stakeholders in complex litigation, regulatory, and compliance matters involving both individual and employer-sponsored benefit products. The practice includes disputes involving life, health, disability, and pension benefits under both state law and ERISA, litigation and arbitration involving life insurance contracts and employer-sponsored group benefit plans, fraud-related matters including STOLI claims, market conduct and regulatory compliance issues nationwide, and employment and agency agreement disputes within the industry. Our attorneys are also active participants and leaders in organizations including DRI, ICA, AFBC, and ACLI.

Multiemployer Plans & Withdrawal Liability

Our practice includes significant experience in the multiemployer plan arena, representing boards of trustees of Taft-Hartley pension and group health plans and counseling plan fiduciaries on all aspects of ERISA compliance, plan management, and administration. We routinely represent plans’ interests in matters before the Pension Benefit Guaranty Corporation, the U.S. Treasury Department, and the DOL. Our team has successfully secured critical relief for distressed plans, including the first joint Benefits Suspension and Partition Orders from Treasury and the PBGC, saving a client over $100 million in pension liabilities.

We also advise employers and plans on all aspects of withdrawal liability under Title IV of ERISA, from initial assessment through arbitration and litigation of contested claims, and we counsel corporate clients on structuring transactions to avoid or manage withdrawal liability exposure.

ERISA Compliance for Funds

Our practice provides sophisticated counsel to fund sponsors and investment managers on the intersection of ERISA and the Investment Company Act of 1940 (‘40 Act). In particular, we can help funds prepare to bring private-market products into the retirement space by offering advice on ways to satisfy their obligations under the ‘40 Act while also preparing a fiduciary-friendly product that can more easily allow ERISA fiduciaries to comply with their prudence and disclosure obligations. We also help private funds navigate ERISA’s plan assets regulation to understand how their choices (including with regard to the regulations’ venture capital operating company and real estate operating company exemptions) affect ERISA fiduciary status.

Mergers & Acquisitions

Our team regularly advises buyers and sellers on the employee benefits and executive compensation implications of corporate transactions, including mergers, acquisitions, divestitures, and restructurings. We conduct comprehensive due diligence of target companies’ benefit programs, identify and quantify actual and contingent benefit obligations, and structure transaction agreements to address ERISA-related risks, including potential withdrawal liability from multiemployer plans. Following the close of a transaction, we bring extensive experience integrating benefits platforms — a complex undertaking that requires careful coordination of plan design, compliance, and employee communications.

Industry Focus

Our attorneys have advised clients across a wide range of industries, including high-technology and bioscience companies, energy and natural resources (including renewable energy, clean hydrogen, carbon capture, and power and utilities), air carriers, defense contractors, logistics and express delivery, financial services, food services, the entertainment industry, hospitality, healthcare, insurance, and the cannabis, hemp, and CBD sector. In the energy sector, our team has supported renewable energy projects, advised on structuring tax equity and project finance transactions, counseled clients on renewable energy credits and incentives, and conducted M&A tax due diligence for energy transactions. We also bring specialized knowledge of the unique benefits and tax challenges confronting cannabis and hemp companies. Our practice includes attorneys who navigate the complex intersection of ERISA, the Code, and federal and state cannabis laws — an area where few law firms have meaningful depth. We counsel associations, member companies, growers, distributors, dispensaries, and license holders on how Section 280E of the Code affects their payroll, 401(k) plans, health benefits, and insurance deductions, and we have been instrumental in structuring retirement, stock, and health programs and brokering the relationships necessary for cannabis, hemp, and CBD companies to level the playing field in competing for talent by offering meaningful employee benefits. In addition, we serve as outside counsel to fraternal benefit societies and nonprofit healthcare organizations, and we advise on the formation and governance of tax-exempt entities, including 501(c)(3) organizations and charitable foundations. Our commitment to the employee benefits community extends beyond client engagements: members of our team serve on the boards of directors and boards of trustees of major employee benefits providers, overseeing defined benefit, defined contribution, health, and life and disability plans serving thousands of affiliated organizations across the country.

Our Team

Pierson Ferdinand’s ERISA, Tax, and Employee Benefits team is nationally recognized for its depth and breadth. Our attorneys include former in-house counsel at Fortune 500 insurers and nonprofit health systems, seasoned practitioners from leading Am Law 200 law firms and a Big Four professional services firm, and former senior staff from the U.S. Department of Labor and the U.S. Securities and Exchange Commission. Members of our team have been recognized in The Best Lawyers in America and The Legal 500, and they are frequent speakers and authors on cutting-edge ERISA and benefits topics before national CPA, human resource, and pension professionals. Our practice is national in scope — as it should be, given that ERISA, the Code, and the federal securities laws are all federal regimes that do not vary by state.