Welfare Benefit Plan ERISA News
May 2015

 
Merely Posting SPD on Intranet Is Insufficient
"Company intranets are a common and convenient tool for benefit communications--but if ERISA's electronic distribution rules are not followed, the plan administrator may not be able to rely on the posted materials in litigation. The takeaway from this case [Thomas v. CIGNA Group Ins.] is simple: Merely placing SPDs on a website, without notifying participants of their availability and significance (and the right to a paper copy), does not satisfy ERISA's requirement that the distribution method be reasonably calculated to ensure actual receipt and result in full distribution." March 26, 2015 EBIA Weekly
The failure to furnish an SPD under DOL guidelines could have other adverse consequences for an employer. For instance, a court might refuse to consider language in the SPD that would clarify an ambiguous plan provision in favor of the employer. And, in the event of benefits-related litigation, a court might even assess a penalty of up to $110 per day for failing to provide an SPD upon request.
For a full list of electronic disclosure requirements, see ERISAPros' FAQs - SPD Delivery Requirements. Employers wishing to deliver their SPDs–as well as Summary Annual Reports (SARs) and Summaries of Material Modifications (SMMs)–electronically should consider using ERISAPros' proprietary Electronic Document Delivery Package (EDP). We provide a set of instructions, a checklist, fillable forms and emails, and a spreadsheet to monitor and document compliance.
Department of Labor Plans Vigorous Enforcement
Department of Labor"The EBSA [Employee Benefits Security Administration] will pursue its mission and strategic objective through vigorous enforcement; proactive regulation and guidance; targeted research; and strong consumer outreach, compliance assistance and education." It will concentrate on issues and areas that have the greatest impact on the protection of plan assets and participants' benefits. Page 66, "U.S. DOL Strategic Plan"
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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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