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2021/2022 ERISA Compliance Checklist

2021/2022 ERISA Compliance Checklist

Have you noticed how many notices it takes to stay compliant with federal labor laws and regulations? Compliance requirements are so numerous that many HR pros might worry about what could slip between the cracks. A checklist can help, especially when it comes to ERISA compliance.

So, what is ERISA and what do you need to know to stay compliant? Find out more.


What’s ERISA?

ERISA stands for The Employee Retirement Income Security Act of 1974. It’s a federal law that establishes the minimum standards for most retirement and healthcare plans in the private sector. Enforced by the Department of Labor, the law is designed to protect employees who enroll in these employer-sponsored benefits. ERISA noncompliance can be costly to organizations offering qualified plans.


What Plans Are Covered Under ERISA?

Any retirement plan that provides either retirement income in the future or the opportunity for employees to contribute current wages to retirement. Major plans covered under ERISA include:

  • Major medical plans
  • Dental
  • Vision
  • Prescription benefits
  • FSAs
  • HSAs
  • Specific EAPs
  • Wellness programs
  • Cancer policies

Plans that will not fall under ERISA primarily include pensions or other plans provided by the United States government, state or local governments, and churches. 

Employers who administer ERISA-qualified plans are called “fiduciaries” and bear responsibility for compliance.

ERISA compliance can be a lot, but it can also be anticipated. Requirements fall into two main categories: ongoing and calendar-based.


ERISA Ongoing Requirements:

Several ERISA requirements are ongoing or met as-needed. These fiduciary responsibilities include:

  • Deposits: All loan payments and employee elective deferrals should be deposited on time. Many administrators make these deposits at the same time as payroll taxes.
  • Enrollment Opportunity: Once an employee has met the plan age and service requirements, they must be given the opportunity to enroll in the plan. All necessary instructions and forms should be provided to them as well as any applicable notices and a Summary Plan Description.
  • Loan Repayment:All outstanding loans must be repaid according to the borrowers’ promissory note and the plan’s policy terms.
  • Notice of Plan Changes: Administrators must notify participants of any plan changes 30-90 days prior to the change’s effective date.
  • Participant Fee Disclosure: A fee disclosure must be sent annually to all participants with an account balance. This applies to all plan-eligible and terminated employees and their beneficiaries.
  • Plan Document: Management of the plan must adhere closely to the terms of the plan document. Any deviation could lead to disqualification by the IRS.
  • Quarterly Management: Any unallocated forfeitures should be used. Loan defaults should be processed. Account balances should be cashed out for terminated employees.

Of course, the requirements above are not necessarily scheduled, but using the checklist should help you make sure nothing is overlooked.


ERISA Calendar Requirements:

Many ERISA requirements, however, are regularly scheduled. Here’s a checklist broken down by each quarter of the plan year:

First Quarter:

Second Quarter:

Third Quarter:
  • A Summary Annual Report for the prior year must be provided to participants.
  • An updated Summary Plan Description must be provided to participants if the plan document had been changed in the prior year.
  • Prior-year Form 5500 must be filed—or for an extension, Form 5558 must be filed.
  • Within 45 days, second-quarter benefits statements must be distributed to participants.
Fourth Quarter:

Although some requirements are specific to your plan year, you can easily schedule them out on a compliance calendar with other important HR dates and distribute them via an HRIS such as BerniePortal. Look here to the Department of Labor, for a detailed list of possible penalties for noncompliance.


What Else Can HR Do to Ensure ERISA Compliance?

ERISA compliance can be a burden, especially if you’re trying to manage it alone, but it can be done. If you’re overwhelmed by ERISA and other compliance requirements, you might consider working with a third-party administrator.

An all-in-one human resources information system (HRIS) like BerniePortal can also help you manage the administrative strain. You can also stay informed, educated, and up-to-date with employer compliance, using BerniePortal’s comprehensive resources:

  • BerniePortal Blog—a one-stop-shop for HR industry news
  • HR Glossary—featuring the most common HR terms, acronyms, and compliance
  • HR Guides—essential pillars, covering an extensive list of comprehensive HR topics
  • BernieU—free online HR courses, approved for SHRM and HRCI recertification credit
  • HR Party of One—our popular YouTube series and podcast, covering emerging HR trends and enduring HR topics
BernieU Course The Ultimate Guide to Benefits Administration and Open Enrollment
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