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Special COVID-19 Health Insurance Enrollment Windows and Waivers

As a result of the ongoing COVID-19 pandemic, we are observing all sorts of never-before-seen changes in the fully-insured group health plan space.  Many insurers are liberally waiving their normal rules to accommodate the continuation of coverage to employers and employees in their time of need.  Although the accommodations are welcome, employers need to exercise … Continue Reading

Employee Benefits Issues to Consider Before Deciding to Furlough or Terminate Employees During the COVID-19 Pandemic

With the combination of our nation’s response to COVID-19 and the resultant economic downturn, employers of all sizes face the moral and financial dilemma of evaluating employee headcounts while businesses are grappling with the reality of the current situation.  Many employers are considering furloughs, or other types of approved leaves of absences, to reduce immediate … Continue Reading

CalSavers Not Preempted by ERISA

With an alarming number of American workers lacking adequate retirement savings, California and a handful of other states began implementing state-sponsored retirement savings programs.  The CalSavers Retirement Savings Program (CalSavers) was first launched as a pilot program in 2018 and then expanded to all eligible employers in the state in July 2019 in order to … Continue Reading

Implications of COVID-19 on Your Health and Welfare Benefit Plans

Employers are grappling with employee benefit issues in response to the 2019 Novel Coronavirus (“COVID-19”).  Efforts are being made to pave the way for widespread testing by eliminating cost barriers such as deductibles, copayments, coinsurance, or High Deductible Health Plan restrictions to ensure employees and their families are proactively being diagnosed once symptoms present, to … Continue Reading

The Supreme Court Defines Actual Knowledge

In a closely watched decision, Intel Corporation Investment Policy Committee v. Sulyma, Slip Op. No. 18-1116 (U.S. S. Ct., Feb. 26, 2020), construing ERISA’s three-year statute of limitations, see ERISA § 413(2), 29 U.S.C. § 1113(2), the Supreme Court held unanimously (J. Alito) that “actual knowledge” means “. . . when a plaintiff actually is … Continue Reading

Republicans Propose Wholesale Reform of Multiemployer Pension Plan System

In a white paper and technical explanations, Republican Senators Charles E. Grassley (Chairman of the Senate Committee on Finance) and Lamar Alexander (Chairman of the Senate Committee on Health, Education, Labor and Pensions) have proposed reforms to the multiemployer pension plan system. If implemented, the proposed reforms (not yet introduced as a bill) would represent … Continue Reading

Judicial Trend Away from Recognizing Equitable Remedies for Benefit Claims under ERISA.

A court in Florida has declined to expand the remedies available under a claim for benefits due under 29 U.S.C. § 1132(a)(1)(B) of ERISA. Keys v. Bell, 2019 U.S. Dist. LEXIS 195505 (M.D. Fla. 2019). The court dismissed the plaintiff’s claim for “equitable estoppel by silence” under that provision of ERISA’s civil remedies. This supports … Continue Reading

North Carolina Court Awards $41 Thousand-Plus Penalty for Failure to Produce Documents Requested by Plan Participants

Section 104(b)(4) of ERISA provides that a plan administrator must respond to a written request for certain documents (including the plan documents and summary plan description) by a participant or beneficiary by providing the requested documents.  Section 502(c)(1) of ERISA and Regulation § 2575.502(c)-1 provide that a plan administrator who fails to do so within … Continue Reading

First Crack in the Armor of the Segal Blend?

The Segal Group is the premier actuarial firm in the country providing services for hundreds of multi-employer pension funds.  For almost 40 years it has used its own methodology, known as the “Segal Blend” to calculate employers’ withdrawal liability successfully without an adverse ruling by either a court or an arbitrator in hundreds of cases. … Continue Reading

Don’t Overlook Your Employee Benefit Plans as You Evaluate the Effect of the Final Overtime Rule

Before employers implement their proposed workforce changes resulting from the finalization of the new overtime rule, released September 24, 2019, see our article for more information, employers should consider what impact those proposed workforce changes may have on their employee benefit plans. Employee benefit plans with criteria for eligibility, contribution, etc. based on the classification … Continue Reading

District of Columbia Commuter Benefits: New Penalties, Fines

Penalties and fines for non-compliance with Washington, D.C.’s law requiring D.C. employers to offer commuter benefits to their D.C. employees will take effect beginning on November 14, 2019.  The law, which became effective on January 1, 2016, requires employers with at least 20 employees in D.C. to offer commuter benefits to their covered employees.  Please … Continue Reading

The Final Regulations For 401(k)/403(b) Hardship Distributions

On September 23, 2019, the Treasury Department and IRS published final regulations for hardship distributions from both 401(k) and 403(b) plans (the “Final Regulations”).  Essentially the hardship distributions changes relax the hardship distribution requirements (i.e., making it easier for participants to obtain hardship distributions) and eliminate many burdens following a hardship distribution (i.e., allowing participants … Continue Reading

Department of Labor Provides Guidance on Retirement Plan Obligations When Employees Return From Military Service

The Department of Labor recently issued a fact sheet intended to help employers understand their retirement plan obligations under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”).  The law provides that eligible employees that return to employment following qualified military service must be treated as though their military service was not a … Continue Reading

The IRS Doesn’t Disappoint…Again

As imagined by plan sponsors of closed defined benefit pension plans, the IRS issued Notice 2019-49, the fifth extension for an additional year of the temporary nondiscrimination relief for “closed” defined benefit pension plans originally announced by the IRS during 2014.  The extended relief applies to plan years beginning before 2021 for those “closed” plans … Continue Reading

Beginning in 2020, Employers May Reimburse Health Insurance Premiums as an Alternative to a Traditional Group Health Plan (Subject to Several Requirements)

Many employers have contacted us over the years asking whether they may offer an “employer–payment plan” rather than offer a traditional group health insurance plan.  An employer-payment plan is a type of account-based plan that provides an employee reimbursement for all or a portion of the premium expense for individual health insurance coverage or other … Continue Reading

Benefits Outside the Box: Using a Charitable Foundation to Enhance Your Culture and Community

If your Company leadership is looking for an innovative employee benefit – something outside the standard employee benefit package of retirement, health, and welfare benefits, a Company-sponsored charitable foundation might be your answer.   A charitable foundation not only can further your Company culture while serving the community, but it also has tax benefits to boot. … Continue Reading

Third Circuit Joins Majority in Rejecting “De Facto Administrator” ERISA Theory

The U.S. Court of Appeals for the Third Circuit joins the Second, Seventh, Eighth, Ninth, and Tenth Circuits in declining to impose liability on alleged de facto plan administrators.  Under Section 502(c) of ERISA, a plan administrator may be liable and subject to penalties for failing to comply with a participant’s request for information which … Continue Reading

Employers Beware: SC Abolishes Common-Law Marriage

On July 24, 2019, South Carolina joined the ranks of Alabama, Pennsylvania, and others in abolishing future recognition of common law marriages in the state.  The state will continue to recognize all common law marriages in effect before this date, but they will be subject to a higher standard of proof.  On and after July … Continue Reading

A Deadline is a Bright Line: How Fessenden Narrows “Substantial Compliance” in the Seventh Circuit

Last week the U.S. Court of Appeals for the Seventh Circuit ruled that the deadline imposed under ERISA for plan administrators to decide on benefit claims is a “bright line” rule. The court held that when a plan administrator misses this deadline, the “substantial compliance” exception to statutory compliance does not apply and the plan … Continue Reading

How Multiemployer Pension Plans Continue To Extract More From Contributing Employers Than What They Bargained For

Contributing employers to multiemployer pension plans (“MEPPs”) are commonly surprised that their obligations to such a plan can extend well beyond the contributions required under a collective bargaining agreement (“CBA”) negotiated with a union.  The most significant extra-contractual obligation is withdrawal liability, a statutory exit fee imposed on employers that leave a plan that has … Continue Reading

EASTERN DISTRICT OF NEW YORK REFUSES TO ENFORCE AN ERISA ANTI-ASSIGNMENT PROVISION

The list of the federal courts of appeals enforcing unambiguous anti-assignment provisions in ERISA health benefit plans continues to grow:  almost exactly one year ago, the Third Circuit joined its sister circuits in holding “that anti-assignment clauses in ERISA-governed health insurance plans as a general matter are enforceable.” As the Third Circuit opinion noted, every … Continue Reading

A Quick Form W-4 Reminder for Employers: May 10, 2019 Deadline for Updates

The Tax Cuts and Jobs Act (the “Tax Act”) significantly changed the federal income tax rules.  Several of these changes impact income tax withholding, including changes to the tax rates and brackets, increasing the standard deduction, and eliminating personal exemptions. Normally, employees must provide their employers with an updated Form W-4 within 10 days of … Continue Reading

The IRS is on the Case – “Expansion of the Gig Economy Warrants Focus on Improving Self-Employment Tax Compliance”

The nature of work is changing with more and more individuals choosing to be “gig” workers rather than employees. This change fundamentally alters the availability of employee benefits, as well as the applicable taxation reporting and withholding requirements. It is no surprise to us that the Treasury Department has found that the underreporting of self-employment … Continue Reading
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