ERISA Penalty Adjustments Announced

From ChamberChoice

The Employee Benefits Security Administration (EBSA) is the enforcement arm for the Department of Labor (DOL) as it relates to employee benefit plans. The EBSA enforces ERISA’s fiduciary, reporting and disclosure provisions. Civil monetary penalties can be assessed for compliance failures of any of these requirements. Penalties however, become less effective when they have not been raised to keep up with inflation. Therefore, based on the Inflation Adjustment Act, new penalty amounts are adjusted annually in January.

Increased penalty limits for 2018 are scheduled to be effective as of Jan. 2, 2018 when they will be published in the Federal Register. Employers need to be aware of these penalties as many are applicable to employee benefits they offer. 

At right is a brief table outlining some of the increases.

Although the DOL does not typically assess the maximum permissible penalty under the law, the looming penalties may spur plan sponsors and administrators to more closely scrutinize their compliance efforts.