Most business owners understand the importance of offering their employees benefits. However, are you aware that federal law prescribes specific guidelines for your current plan to meet?
This is true, and unfortunately, not all agents possess a thorough understanding of the process or will inform you of any shortcomings. To keep you updated, our seasoned team at Winter-Dent has assembled this concise guide on how to ensure your employee benefits align with ERISA Compliance requirements.
What Is ERISA, and Why Is Compliance Important?
Before we delve into why compliance is crucial, let's consider what ERISA actually means. The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that prescribes minimum standards for most voluntarily established retirement and health plans in private industries. Its design is to shield workers while providing individual companies with a structure for the sorts of benefits they should extend.
Therefore, particular rules apply when you provide retirement or health insurance benefits to your employees. Non-compliance can attract significant penalties – a circumstance you'd want to avoid for your business. Here’s a good checklist of ERISA requirements for you to take a look at.
Understanding the Two Parts of ERISA
So, what do these guidelines entail? ERISA comprises two parts: Title I and Title II.
Title I pertains specifically to investment benefit plans like a 401K. Its goal is to safeguard individual participants and beneficiaries in employee benefit plans. In simple terms, it mandates that you provide your employees and their beneficiaries with sufficient and suitable information about their plans.
Title II concerns health and/or welfare plans. Instances of this might be medical insurance, dental coverage, vision, AFLAC, disability coverage, and others. Compliance with these standards is a prerequisite for retirement benefit plans to qualify for preferential tax treatment. Non-compliance could lead to disqualification and/or penalties for your organization.
Meeting the ERISA Compliance Requirements
Fortunately, meeting ERISA compliance requirements doesn’t have to be difficult or burdensome for your business. Most requirements are deadline-driven, hence the need to attend to them within a specific period. You must also retain your documentation on file, especially for auditing purposes.
Furthermore, you are expected to share documents and notices with your employees and have the information available to them if they wish to review them at a time different from when the initial documentation was disseminated.
Leveraging the Expertise of an Informed Broker Partner for ERISA Guidelines
If the requirements seem like a demanding addition to your already full plate, you're not alone. That's why many businesses opt for an experienced broker to manage all their benefit programs. This agency and its team stay current with the latest guidelines and can guide an employer through the process.
This informed broker partner team or organization also partners with you to handle ERISA documentation requirements in case of an audit, and ensures you're consistently compliant with pertinent ERISA rules.
How Winter-Dent Can Assist You Stay Compliant
At Winter-Dent, we comprehend what staying fully ERISA compliant entails. As a trusted partner, we can help your business meet the stipulations for extending workers' health and retirement benefits. Our team will aid in preparing your SPD wrap document to include all relevant plans, guide you when a summary of Material Modification is necessary, and assist with access to employee notifications and due date reminders. The compliance platform also provides assessment tools to help identify your missing compliance items with a reminder dashboard to ensure nothing slips through the cracks. With access to HIPAA policies, training, forms, and documents, you can effortlessly monitor HIPAA compliance for your business as well. Reach out to us today for more details.
