Whether a one-time voluntary separation program should be treated as an ERISA-covered severance plan depends on whether the program requires an “ongoing administrative scheme” – a requirement first established by the Supreme Court in Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987). In Fort Halifax, the Supreme Court held that ERISA does not … Continue Reading
Clients often are surprised to learn they are liable for ERISA statutory penalties associated with participant document requests even though they have retained an independent third party to administer their ERISA welfare benefits plans (such as disability, life, and health plans). It is fairly well established in most of the federal circuits that only the … Continue Reading
As our earlier article reported, Judge Robert W. Sweet of the U.S. District Court for the Southern District of New York had recently held that a multiemployer pension fund’s use of the “Segal Blend” to calculate a withdrawn employer’s withdrawal liability violated the provisions of the Employee Retirement Income Security Act (“ERISA”), as amended by … Continue Reading
Occasionally qualified plan administrators discover that their plans have incurred an operational error. The Internal Revenue Service (“IRS”) recognizes that it needs the help of plan administrators to police the administration of qualified plans and has correspondingly published guidance to help plan administrators take appropriate corrective action where necessary. IRS Correction Alternatives Revenue Procedure 2016-51, … Continue Reading
It is well-established under the Employee Retirement Income Security Act of 1974 (“ERISA”) that when an employee benefit plan grants the plan administrator discretion to decide questions of eligibility for benefits or to construe plan terms, judicial review of the plan administrator’s denial of benefits is generally limited to the deferential abuse of discretion standard … Continue Reading
Employers who offer short-term and long-term disability plans governed by the Employee Retirement Income Security Act (ERISA), and their plan administrators, need to prepare for the approaching April 1st deadline of the new claims handling regulations. Employer action items can be found in our article posted here. The ERISA regulations were effective January 2017, but were delayed until … Continue Reading
Explaining that “[a]s any sports fan dismayed that instant replay did not overturn a blown call learns, it is difficult to overcome a deferential standard of review,” a panel of the Fifth Circuit Court of Appeals has called for a re-examination of the Court’s standard of review in ERISA denial of benefits cases where the … Continue Reading
The U.S. Department of Labor (DOL) publicized last year its stepped up enforcement efforts inquiring about procedures used by larger defined benefit plans for locating, and then beginning payment of benefits to, terminated vested participants who have reached the age when the plan mandates benefits must begin. Those audit activities are continuing. For years, the … Continue Reading
In Halo v. Yale Health Plan, decided in April of 2016, the Second Circuit expressly rejected the “substantial compliance” doctrine with respect to alleged violations of the ERISA Claims Procedure regulation. Instead, the Court held that, in order to preserve otherwise properly reserved discretionary authority, the decisionmaker must demonstrate that any deviation from the requirements … Continue Reading
Last week I made a presentation in the Omaha office of Jackson Lewis with the above title. I thought it might be helpful to outline the basic points of my presentation. The following items should keep you awake at night unless you can comfortably answer them: Does your employer have ERISA fiduciary insurance? If you … Continue Reading
It has been reported that infamous bank robber, Slick Willie Sutton, once said, “I rob banks because that’s where the money is.” Data thieves, understandably, have a similar strategy – go where the data is. The retail industry knows this as it has been a popular target for payment card data. The healthcare and certain … Continue Reading
When an ERISA plan provides the plan administrator with discretion to interpret the terms of the plan, the administrator’s claims and appeals decisions are generally reviewed by courts under a lenient standard of review such as “abuse of discretion.” In such cases, courts generally will not upset the plan administrator’s decision absent a clear error. … Continue Reading
In the last six months, several clients called me regarding substantial balances in a so-called “forfeiture account” in their 401(k) plans. A few of these clients have forfeiture accounts that violate the ERISA requirements. It is imperative that forfeitures be handled properly since both the IRS and the Department of Labor (DOL) on audit generally … Continue Reading
The U.S. Supreme Court has narrowed, ever so slightly, the ever-changing definition of “appropriate equitable relief” under ERISA Section 502(a)(3). In Montanile v. Board of Trustees of the National Elevator Industry Health Benefit Plan,[1] the high court addressed whether a plan fiduciary can recover medical payments made on behalf of a participant when the plan … Continue Reading
The Employee Benefits Security Administration (EBSA) of the Federal Department of Labor plans to publish on November 18, 2015, new claims procedures for adjudicating disability benefits designed to enhance existing procedures for those benefits under Section 503 of the Employee Retirement Income Security Act (ERISA). EBSA’s goal is to apply to disability benefits many of … Continue Reading
Five years ago, Chief Justice Roberts observed: “People make mistakes. Even administrators of ERISA plans.” Conkright v. Frommert, 559 U.S. 506, 509 (2010). Four years ago, searching for a mechanism to provide monetary relief for such mistakes under ERISA, the Supreme Court reached into the desiccated maw of early 19th century trust law and pulled … Continue Reading
Frequently a plan sponsor’s operational failure to follow the terms of its 401(k) or other qualified plan can be corrected under the IRS’s Employee Plans Compliance Resolution System (“EPCRS”) (described at http://www.irs.gov/Retirement-Plans/EPCRS-Overview) with a retroactive amendment instead of a sometimes expensive financial correction. This possibility should not be surprising, given that the maintenance of qualified … Continue Reading
In a recent decision, Tolbert v. RBC Capital Markets Corp., _________ (S.D. Texas April 28, 2015), the district court wrestled with the question of how to determine whether a deferred compensation plan was a “top-hat” plan exempt from many of the substantive requirements of the Employee Retirement Income Security Act (“ERISA”). The Fifth Circuit previously … Continue Reading
On May 18, 2015, the United States Supreme Court, in a unanimous decision, held that an ERISA fiduciary responsible for the selection of ERISA plan investment choices has an ongoing duty to monitor such choices. As discussed in greater detail in our May 18th Benefits Law Advisor post, Tibble v. Edison International, No. 13-550 (U.S. … Continue Reading
Today, the U.S. Supreme Court announced a much-anticipated ERISA plan decision in the case of Tibble v. Edison International. ERISA practitioners and plan administrators have been watching Tibble with interest because the Supreme Court granted certiorari to consider a very broad question – namely, whether ERISA’s six-year limitations period barred imprudent investment claims where the … Continue Reading
As I perform plan fiduciary governance audits, I am surprised at the continued failure of employers to take fairly simple steps that would substantially minimize employers’ fiduciary risk. Therefore, I thought it would be helpful to employers to set forth seven critical tips that employers can take to reduce potential fiduciary exposure. Tip 1: Separate … Continue Reading
Today the Equal Employment Opportunity Commission (EEOC) published long-awaited proposed regulations on wellness programs (Proposed Regs) that are intended to harmonize certain provisions of the Americans with Disabilities Act (ADA) with long-standing rules concerning wellness programs applicable to group health plans under the Health Insurance Portability and Accountability Act (HIPAA), and more recently, the Affordable … Continue Reading
In Prouty v. The Hartford Life & Acc. Ins. Co. & C&S Wholesale Grocers Inc., 997 F. Supp. 2d 85, 88 (D. Mass. 2014), the plaintiff asserted an ERISA claim against her former employer and the issuer of her employer’s group life insurance plan, claiming that both breached their fiduciary duties by failing to provide … Continue Reading
We reported in December 2014, that the Equal Employment Opportunity Commission (EEOC) said it was planning to issue proposed regulations (scheduled for February 2015) that would “promot[e] consistency between the ADA and HIPAA, as amended by the ACA,” and “clarify[] that employers who offer wellness programs are free to adopt a certain type of inducement … Continue Reading
