Most business owners believe that providing employees with a modest amount of benefits is more than generous. However, did you know that there are certain guidelines that you have to follow to ensure your current plan meets federal requirements?
It’s true. And, sadly, not every agent is knowledgeable about the process or will let you know where you’re falling short. To help keep you updated, our team at Winter-Dent has put together this brief guide. Here’s how to make sure your employee benefits in compliance with ERISA Compliance requirements.
What Is ERISA?
Before we can discuss why it is so important to be in compliance, we first have to explain what ERISA actually entails. The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that sets minimum standards for most voluntarily established retirement and health plans in private industries. It was designed to protect workers while giving individual companies a framework for the types of benefits they should provide.
This means that there are certain guidelines you have to follow when providing retirement or health insurance benefits to your employees. Failure to adhere to these rules can result in hefty penalties, which is not something you want to happen in your business.
There Are Two Parts to ERISA
So, if these guidelines are important, what are they? There are actually two parts to ERISA: Title I and Title II.
The first deals specifically with investment benefit plans, such as a 401K. The purpose and goal of Title I is to protect individual participants and beneficiaries in employee benefit plans. Simply put, it requires you to provide your employees and their beneficiaries with adequate and appropriate information about their plans.
The second part of ERISA is all about any health and/or welfare plans. Examples of this would be medical insurance, dental coverage, vision, AFLAC, disability coverage, and others. The purpose of these standards must be met by retirement benefit plans before you can qualify for favorable tax treatment. Noncompliance can result in disqualification and/or penalties for your organization.
Need a quick hint? Here’s a good checklist of ERISA requirements for you to take a look at.
Meeting ERISA Compliance Requirements
The good news is that meeting ERISA compliance requirements doesn’t have to be difficult or burdensome for your business. Most are deadline driven, which means you just have to get them handled within a certain period of time. Your documentation must also always be kept on file, just in case you’re ever audited.
In addition, documents and notices must be shared with your employees. You should also have the information readily available to your workers, should they ever come to you and want to review it at a time other than when the initial documentation was sent out.
Using an Informed Broker Partner to Meet ERISA Guidelines
If that sounds like a lot to add to your already full plate, we get it. That’s why most companies select an experienced broker to to handle all of their benefit programs. This agency and their team stay up-to-date with the latest guidelines and can guide an employer through the process.
This informed broker partner team or organization also works with you to handle ERISA documentation requirements in case of an audit and ensures you’re continually compliant with applicable ERISA guidelines.
How Winter-Dent Can Help Keep You in Compliance
At Winter-Dent, we understand what it takes to remain fully ERISA compliant. As a trusted partner, we can help your business fulfill the requirements for providing workers with health and retirement benefits. Our team will help prepare your SPD wrap document to encompass all relevant plans, guide you when a summary of Material Modification is appropriate, and help with access to employee notifications and due date reminders. The compliance platform will also offer assessment tools to help determine your missing compliance items as well as a reminder dashboard to make sure nothing falls through the cracks. With access to HIPAA policies, training, forms, and documents, you can easily track HIPAA compliance for your company as well. Please contact us today for details.