ERISA Enforcement & Penalties
We continue to be reminded lately of the importance of the employer’s role as a fiduciary of the benefit plans offered to employees. As a fiduciary, the employer is required to act in the best interest of plan participants. The employer’s fiduciary duties include, amongst other things, setting and following plan terms such as benefit inclusions and exclusions, eligibility for coverage, and claims procedures; adopting formal plan documents; providing participant disclosures; reporting certain information to the government (e.g., Form 5500s); properly handling plan assets; and carefully selecting and managing any plan service providers. In January, the DOL released the updated ERISA civil monetary penalty amounts for 2024 for things such as failing to file an annual Form 5500 or failure to annually distribute the summary of benefits and coverage (SBC). The fact sheet on these updates can be found here – https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/fact-sheets/adjusting-erisa-civil-monetary-penalties-for-inflation
In addition, EBSA recently released a summary of 2023 enforcement activities. You can find the news release and fact sheet here – https://www.dol.gov/newsroom/releases/ebsa/ebsa20240213