Frequently Asked Legal Questions
Can an employer market the Emerge Workplace Loan and Financial Education program
to its employees as an employee benefit without being held potentially liable for any
lending risk? Even if there is no money provided by the employer?
The Emerge Program can be treated as any other benefit offered by the employer. For example, an
employer can provide descriptions of the Emerge Program in its Employee Handbook or on its benefits
page on its internal website. The employer should describe that while the company offers the benefit, the
employee is fully responsible for all handling of the loan—as would be the case with any other banking
product.
Can the employer provide a link to the Emerge website from its website/intranet without
seeming to endorse the product offering? Is this different for nonprofit or public-sector
employers?
So long as the benefit offering for the Emerge program is properly explained to the employee – either on
the employer website/intranet or in the Employee Handbook – the employer may provide a link on its
internal website. This is the same for all types of employers, including nonprofit and public-sector
employers.
Is Emerge Workplace Solutions subject to ERISA?
The Emerge Program should not constitute an ―employee welfare benefit plan‖ or ―welfare plan‖ as
defined in ERISA and should not be subject to ERISA or the ERISA reporting requirements.
The provisions of the Employee Retirement Income Security Act of 1974 (―ERISA‖) generally apply to any
―employee welfare benefit plan,‖ ―pension plan,‖ or other ―employee benefit plan‖ maintained by certain
employers. These include plans that provide medical, sickness, accident, disability, death or
unemployment, vacation benefits, apprenticeship or other training benefits, day-care centers, scholarship
funds, or prepaid legal services. 2 U.S.C. § 1002(1). ERISA also covers certain plans, funds or programs
providing for holiday, severance or similar benefits, and financial assistance for employee housing,
regardless of whether they are funded through a trust. 29 C.F.R. § 2510.3-1(a)(3); Scott v. Gulf Oil Corp.,
754 F.2d 1499, 1502-3 (9th Cir. 1985).
Is there any data that the employer has in its employee data file or personnel record that
cannot be released with written consent by the employee to Emerge for the purposes of
underwriting a loan?
The California Constitution imposes broad limitations on the unilateral disclosure of an employee’s private
information by his or her employer. See CAL. CONST., art. I, § 1. However, any limitations on disclosure
of personal information can be waived through the express written consent of both the individual and the
business. CAL. CIV. CODE § 1799.1(a). In other words, both the employer and employee must provide
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written consent to Emerge in disclosing the contents of any employee data file or personnel record.
Can employers provide Emerge with information pertaining to an employee’s
resignation or last pay period so that Emerge can directly contact any delinquent
borrowers?
A simple, short statement that merely reports a separation date (without disclosing the reason for
separation) is information that an employer can provide to Emerge without raising any privacy concerns.
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