Welfare Benefit Plan ERISA News & Views - April 2010

ERISAPros' Document Disclosure Package
ERISAProsnew package of customized forms, instructions, and checklists take the guesswork and hassle for employers out of meeting ERISA's disclosure and delivery requirements.  ERISAPros makes document delivery easy, efficient, and cost effective - whether an employer uses paper or electronic means.
The Department of Labor (DOL) requires that employers disclose certain Plan information to Participants through various reports, such as Summary Plan Descriptions (SPDs), Summary Annual Reports (SARs), Summary of Mateial Modifications (SMMs), and other ERISA documents. The DOL imposes strict requirements as to the content, timing, frequency, and method of delivery of these documents.
Electronic communication is replacing paper correspondence. An employer can enjoy significant savings in printing costs, time, and labor by delivering materials electronically on its website. However, this method involves several additional steps and forms, such as delivering a properly drafted "Notice" and "Disclosure" to Participants and obtaining a "Consent" from them prior to actual delivery of materials.  
Documents must be delivered to Plan Participants in a way "reasonably calculated to ensure actual receipt."  Paper and electronic delivery are acceptable methods. However, merely placing a supply of documents in the employer's break room, posting them on the company's website, or instructing employees to pick up a copy from the HR department does not satisfy the DOL delivery requirements
An employer may be fined up to $110 per day for each day that these documents are delivered after the deadline. This penalty applies for each Plan, and it is cumulative. Where an employer maintains separate life, health, dental and disability plans that are not part of a single wrap plan arrangement, the $110 a day penalty is applicable to each plan.  Delivering that employer's SPDs just 30 days late subjects it to a fine of $13,200!  ERISAPros' "Wrap-Tight"sm SPD approach reduces that liability to only $3,300 for all four plans. 
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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.


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