By Glenn Hamer, President & CEO, Texas Association of Business
This week, the Texas Association of Business (TAB) led a coalition of nearly 50 companies and local chambers of commerce in writing a letter to Texas legislators calling for the preservation of the Employee Retirement Income Security Act (ERISA) – a crucial tool that provides businesses with consistency and uniformity in offering employee benefits.
ERISA was passed by Congress in 1974 and governs laws that affect the administration or design of employer-sponsored health plans. ERISA provides for a consistent regulatory framework that allows employers to operate confidently and seamlessly across state lines, minimizing the administrative burdens that would otherwise come with a patchwork of different state-level regulations.
In the letter to state leaders this week, TAB and its coalition partners write:
“ERISA’s uniformity is essential to Texas’ economic success, enabling businesses to offer competitive benefits and maintain operational efficiency without the complexities of varying state mandates. For small and medium-sized businesses in particular, ERISA’s protections are crucial for providing affordable and consistent benefits across their workforce.”
The letter also highlights the potential negative impacts Texas businesses and our workforce could see if lawmakers decide to pursue detrimental legislation to preempt ERISA:
“Unfortunately, recent legislative efforts have sought to circumvent ERISA’s protections by imposing state-level healthcare mandates on employers. These efforts risk significantly increasing healthcare costs for Texas employers and their employees. Allowing expensive state mandates to interfere with ERISA protections would create a patchwork of conflicting rules, making it harder for businesses to offer consistent, affordable health benefits and weakening Texas’ ability to attract and retain businesses.”
ERISA’s protections have played a significant role in cementing Texas’ reputation as a pro-business powerhouse. Under these protections, private employers have been able to offer attractive benefit plans for their employees, establish consistent guidelines for retirement and health plans provided by multi-state private employers, and protect employers by supporting a uniform benefit program for all employees and by avoiding complications of a patchwork system between states.
As I wrote in the Dallas Morning News on the occasion of ERISA’s 50th anniversary last month:
“At the Texas Association of Business, we believe that preserving ERISA needs to be a top priority. State leaders must reaffirm their commitment to ERISA and resist the push for additional state-level regulations that could disrupt the delicate balance that has been so carefully maintained over the past 50 years. By standing with the business community and upholding the federal oversight that ERISA provides, Texas can maintain its position as a prime example of economic resilience and growth.
“The anticipated rise in health care costs in 2024 emphasizes the vital need to uphold the regulatory consistency provided by ERISA. Imposing additional state-level mandates would not only create a patchwork of regulations that increase compliance costs but also discourage businesses from expanding their operations in Texas — ultimately damaging our economy.”
The business community and its workforce need the security that ERISA provides to all parties involved. Supporting the health and well-being of our workforce shouldn’t be controversial, but a given. An industry standard like ERISA nationwide will help keep Texas the premiere destination for businesses and job creators. We hope the Legislature will avoid misguided attempts to undermine this important law that has helped make Texas the envy of the nation and work toward sustaining this crucial piece of legislation for the next 50 years.
To read the full letter, click here.