As an HR professional, you know how much care it takes to stay compliant with state and federal labor laws—especially because they continue to be changed and updated periodically.
In many cases, these changes lead to new and often stricter provisions to follow, but a recent Department of Labor guideline update for ERISA plan audits may have made staying compliant slightly easier. Read on to find out how.
ERISA is the Employee Retirement Income Security Act of 1974. Enforced by the Department of Labor, ERISA is a federal law that establishes standards for most retirement and healthcare plans in the private sector. It’s designed to protect employees who enroll in these benefits.
One provision of ERISA is that plans covered under it must submit to an annual audit of the details of the plans. These audits confirm that qualified plans meet the minimum standards described in the law, and they must be conducted by an “independent qualified public accountant” to prevent fraud or abuse of the law.
In a recent press release, the DOL announced changes to the definition of an independent qualified public accountant—most specifically, the “independent” part. Two major changes are relevant to employers:
Ali Khawar, the Acting Assistant Secretary of Labor for Employee Benefits Security, explained that the goal of these changes is to “foster proper auditor independence while also removing outdated and unnecessary barriers to plans accessing highly qualified auditors and audit firms.”
In short, the DOL wants to make sure ERISA audit guidelines are fair and appropriate for today’s businesses.
Because of these changes, your organization may have a wider pool of auditors to choose from while remaining compliant, since the restrictions on who qualifies have been loosened. With that said, plan sponsors should consider which auditor they select carefully, as those who conduct more ERISA audits are less prone to (time-consuming and sometimes costly) errors.
Compliance concerns like these come up constantly, and if you want to keep up, we recommend choosing an all-in-one HRIS like BerniePortal, which comes with a team of experts ready to help you offer and administer benefits customized to your compliance needs.
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