Employers can soon self-correct certain retirement plan contribution errors, thanks to federal regulations published Wednesday.
Beginning March 17, employers may use a self-correction tool to “remedy delays in sending participant contributions, such as employee payroll deductions, and participant loan repayments to retirement plans,” according to a U.S. Department of Labor announcement.
When the change was proposed two years ago, a business-side attorney said employers would likely welcome the option to self-correct as it would streamline the process.
The correction program may allow employers and other plan officials to avoid certain civil enforcement actions and penalties under the Employee Retirement Income Security Act and the Internal Revenue Code, DOL said.
“The Employee Benefits Security Administration is pleased to provide these improvements to our Voluntary Fiduciary Correction Program so that employers and other plan officials can take advantage of streamlined tools to correct legal violations, and America’s workers get full protection for their hard-earned benefits,” said Assistant Secretary for Employee Benefits Security Lisa M. Gomez in a statement.
