The Health, Employment, Labor, and Pensions Subcommittee convened a hearing titled “Pension Predators: Stopping Class Action Abuse Against Workers’ Retirement” to address concerns about the impact of class action lawsuits on retirement savings. Subcommittee Chairman Rick Allen (R-GA) led the discussion, emphasizing the need to protect both workers’ retirement assets and employers who offer benefit plans.
In his opening statement, Allen highlighted the significance of employer-sponsored retirement and health plans for American workers and their families. He noted that these plans are governed by the Employee Retirement Income Security Act (ERISA), which covers more than 155 million individuals and holds over $14 trillion in assets.
“These assets represent the savings and contributions of workers and their employers. But make no mistake, such a large pool of assets is attracting predatory lawyers who are targeting employee benefit plans for easy, quick-money, sue-and-settle lawsuits,” Allen said.
Allen criticized recent economic challenges under the Biden-Harris administration, stating that increased inflation has put additional pressure on Americans. He argued that class-action attorneys seeking settlements from employers further threaten jobs and financial security. “On top of that, predatory class-action attorneys are targeting employers who fund retirement, health, and other workplace benefits for their workers—putting jobs and financial security at risk,” he added.
He contrasted this with efforts by Committee Republicans to safeguard savers' interests. “My bill to ensure that investment fiduciaries are focused on maximizing returns for ERISA plan investments rather than on woke ESG factors, passed the Committee earlier this year. Congressman Fine has introduced legislation with solutions to the problems we will hear about today. I look forward to discussing that bill and other efforts to protect ERISA plan participants and their benefit plans,” Allen stated.
The hearing included testimony from witnesses with direct experience managing employee benefit plans facing litigation. Allen outlined key questions for consideration: “We’ll also ask an important question: Are these lawsuits helping American workers or just lining the pockets of lawyers? We will also hear how these lawsuits are changing the way ERISA plans work and what that means for the benefits that American workers rely on.”
