The Department of Labor (DOL) has announced two programs to assist employers and employee benefit plan administrators’ correct violations of the Employee Retirement Income Security Act (ERISA). The first program allows employers to correct past violations without penalties. Under the Voluntary Fiduciary Correction Program, plan officials, sponsoring employers or parties to affected transactions may apply to correct voluntarily specific ERISA violations. An applicant must fully correct any prohibited transaction, calculate any losses and restore those losses (with profits or interest), and distribute any owed supplemental benefits. If properly corrected, a “no action” letter will be issued by DOL.

The second program encourages plan administrators to file overdue annual reports by paying reduced penalties. DOL has updated the Delinquent Filer Voluntary Correction Program, originally established in 1995, to make it easier to participate in the program and to reduce the penalty amounts. For example, the new caps for multiple years late are $1,500 for small businesses and $4,000 for large companies, with the daily rate dropping from $50 to $10.

For more information, call DOL’s employer hotline at (866) 275-7922.

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