Dive Brief:
- The recent storms and flooding in Louisiana not only devastated people's lives directly by costing them their lives, homes and belongings, but it also has an impact on many when it came to their employee benefits.
- With that as the context, the Department of Labor recently released an update on employer compliance with employee benefit plan rules for those adversely impacted in the state since Aug. 11, 2016.
- The main reason for the guidance is that plan fiduciaries, employers, labor organizations, service providers and participants/beneficiaries may face compliance-related issues over the next few months in connection with employee benefit plans covered by the Employee Retirement Income Security Act as the post-flood Louisiana aftermath become clearer.
Dive Insight:
HR and benefits leaders directly affected by those vicious August storms in Louisiana naturally will want to study the Labor Dept.'s guidance, which generally applies to affected parties in a parish identified as covered disaster area due to the storms’ devastation.
The guidance announcement is a complex document, but it provides relief for affected parties from certain verification procedures and reporting deadlines that may be required under retirement plans with respect to plan loans to participants and beneficiaries, hardship distributions and other pension benefit distributions.
The good news is some employers and service providers acting on employers’ behalf, such as payroll processing services, located in identified covered disaster areas who can't forward participant payments and withholdings to employee pension benefit plans within the allotted timeframe will get some wiggle room and likely avoid penalties for late reporting.