An important reminder concerning the Department of Labor.
It has issued an interim final rule identifying increases in certain ERISA civil penalties as a result of enactment of the Federal Civil Penalties Inflation Adjustment Improvements Act of 2015 (which amended related 1990 legislation).
This 2015 legislation required federal agencies to adjust certain civil penalties under their jurisdictions to reflect cost-of-living-adjustment (COLA) increases.
Initial increases must “catch up” with inflation increases as calculated from the year that each respective civil penalty was established. Further increases are to be calculated annually. Under this legislation, the DOL was required to publish these increased civil penalties no later than July 1, 2016, and they are to take effect no later than August 1, 2016. Written comments may be submitted during the 45-day period that begins with this publication date.
Follow are some examples of notices and reports for which the DOL is adjusting penalties.
- Failure to furnish reports /maintain records required for former participant/beneficiary
- Failure or refusal to file required Form 5500
- Failure to furnish automatic contribution arrangement notice
- Failure to provide notice of plan blackout or right to divest employer securities
- Failure to provide certain benefit restriction notices in single-employer DB plans
- Failure to provide information requested by the Secretary of Labor under ERISA
The DOL released the interim final rule in today’s Federal Register, and has released a fact sheet describing the changes. This fact sheet includes a table that shows the current and new penalties.