Employer Compliance Audit

Remember: The Plan Administrator is liable for compliance with ERISA and other federal laws that regulate health and welfare plans. If the plan documents do not identify an administrator, then, by default, it is generally the employer maintaining the plan.

The Plan Administrator is liable for compliance with ERISA and other federal laws that regulate health and welfare plans. If the plan documents do not identify an administrator, then, by default, it is generally the employer maintaining the plan.

Penalties/Liabilities:The Plan Administrator is liable for penalties arising from ERISA noncompliance, which can range from $100 per day per occurrence to $1,100 per day per occurrence. The employer can also be liable for penalties arising from noncompliance with ERISA, HIPAA, COBRA, etc.

The Plan Administrator is liable for compliance with ERISA and other federal laws that regulate health and welfare plans. If the plan documents do not identify an administrator, then, by default, it is generally the employer maintaining the plan.

Penalties/Liabilities:The Plan Administrator is liable for penalties arising from ERISA noncompliance, which can range from $100 per day per occurrence to $1,100 per day per occurrence. The employer can also be liable for penalties arising from noncompliance with ERISA, HIPAA, COBRA, etc.

Remember: When other entities assume a fiduciary role, there must be proper documentation that clearly defines their responsibility and liability. Without proper documentation, the liability for errors committed by a third party may fall back to the employer.

When other entities assume a fiduciary role, there must be proper documentation that clearly defines their responsibility and liability. Without proper documentation, the liability for errors committed by a third party may fall back to the employer.
Penalties/Liabilities: The penalty for breach of fiduciary duty is 20% of the “applicable recoverable amount.” Depending on the type of breach, this recovery amount could be in the hundreds of thousands of dollars.

A COBRA failure incurs a penalty of $100 per qualified beneficiary for each day of noncompliance, with an annual limit of 10% of the aggregate amount paid or incurred by the employer during the preceding year or $500,000, whichever is less.

When other entities assume a fiduciary role, there must be proper documentation that clearly defines their responsibility and liability. Without proper documentation, the liability for errors committed by a third party may fall back to the employer.
Penalties/Liabilities: The penalty for breach of fiduciary duty is 20% of the “applicable recoverable amount.” Depending on the type of breach, this recovery amount could be in the hundreds of thousands of dollars.

A COBRA failure incurs a penalty of $100 per qualified beneficiary for each day of noncompliance, with an annual limit of 10% of the aggregate amount paid or incurred by the employer during the preceding year or $500,000, whichever is less.

Penalties/Liabilities:
COBRA failure = $100 per qualified beneficiary for each day of noncompliance
Form 5500 failure = up to $1,100 per day per occurrence
Pay or Play Penalty = $2,000 per employee if no coverage, $3,000 for each employee that receives a premium tax credit if the coverage s not affordable or does not provide minimum value.