Our Favorite wRAP
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Are you ERISA compliant?
“It gets worse by the annual, my career’s like a “how to manual” so I guess it’s understandable, man.”
While Drake’s 6PM in New York line wasn’t referring to same line of thought as I am, there’s no better way to get on the subject of wRAP (documents).
As you may know, the Department of Labor’s (DOL) Employee Retirement Income Security Act (ERISA) audits are happening more often and bringing steeper penalties.
According to a recent article on ComplianceBug.com, over the past 12 years, 32 percent of health and welfare plans audited received DOL fines in excess of $10,000 due to ERISA and Form 5500 violations. Further, in 2015, the DOL requested an additional $10 million in funds to increase enforcement agents by 300.
The overwhelming triggers of DOL audits include insufficient and inconsistent plan documentation and ERISA violations made by current or former employees.
All private sector employers who maintain welfare plans for their employees are subject to ERISA. Regardless of size, employers subject to ERISA are required to have a written plan and distribute a summary to plan participants. This is where the wrap comes in.
The first item the DOL requests during an audit is a copy of your plan documents. Wrap documents provide the required ERISA language that “wraps” around the insurance certificates. They’re used to define plan eligibility, simplify 5500 filing and ease plan administration.
With penalties of up to $1,100 per day for refusal to file a 5500 or provide documentation upon an employee’s request, the cost of not having the appropriate documentation far outweighs the cost of fulfilling your obligation.
So, before your annual gets worse, take a look at Assurance compliance support or reach out to us directly for help on our favorite wrap!
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