What is a Plan Document?

ERISA (the Employee Retirement Income Security Act of 1974) is a federal law which deals with employee benefit plans, both qualified retirement plans (e.g., pension and profit sharing plans) and welfare benefit plans (e.g., group insurance and other fringe benefit plans). The goals of ERISA are to provide uniformity and protections to employees.

ERISA SPD Requirements

The Summary Plan Description, or SPD, is the main vehicle for communicating plan rights and obligations to participants and beneficiaries. As the name suggests, it is generally a summary of the material provisions of the plan document, which is understandable to the average participant of the employer. However, in the context of health & welfare benefit plans, it is not uncommon for the SPD to be a combination of a complete description of the plan’s terms and conditions, such as a Certificate of Coverage, and the required ERISA disclosure language.

SPD Delivery

The plan administrator/employer is responsible for preparing the SPD and affirmatively delivering it to certain persons, e.g.:

  • covered employees
  • terminated COBRA participants
  • parents or guardians of children covered under a qualified medical support order
  • dependents of a deceased retiree under a retiree medical plan

5500 Prep

Form 5500 Annual Reporting—The plan administrator must prepare a Form 5500 annually for each ERISA plan that an employer sponsors in order to report certain information to the DOL. The deadline for filing is 7 months after the end of the plan year. A 2-1/2 month extension is available by filing a Form 5558. Form 5500 records must be maintained for not less than six years. The DOL requires that all Form 5500s for Plan Year 2009 and later must be filed electronically.