July 7, 2016

Increased Penalties for Reporting and Disclosure Violations (article)

ERISA imposes certain reporting and disclosure obligations on plan administrators or plan sponsors of health and pension plans.  Failure to abide by these reporting and disclosure obligations could result in civil penalties assessed by the Department of Labor’s enforcement agency, the Employee Benefits Security Administration.  These civil penalties may be adjusted at certain times for inflationary reasons.  To this end, following are some of the notable penalty adjustments that become effective August 1, 2016:



Current Penalty Amount

New Penalty Amount

Failure or refusal to file the annual Form 5500

Up to $1,100 per day

Up to $2,063 per day

Failure to file Form M-1

Up to $1,100 per day

Up to $1,502 per day

Failure to provide Summary of Benefits and Coverage

Up to $1,000 per failure

Up to $1,087 per failure

Failure to notify employees of CHIP coverage opportunities

Up to $100 per day

Up to $110 per day


It should also be noted that several penalty adjustments apply to the protections afforded under the Genetic Information Nondiscrimination Act (GINA).  For example, individuals denied access to group health coverage based on his/her genetic information could result in civil penalties of up to $110 per day of noncompliance (up from $100 per day).


In addition, an employer who fails post the Family and Medical Leave Act posting in its workplace could be subject to a civil money penalty by the Wage and Hour Division of up to $163 per each separate offense.


The information contained in this article is provided as general guidance and may be affected by changes in law or regulation. This article is not intended to replace or substitute for accounting or other professional advice. Please consult a CBIZ professional. This information is provided as-is with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.   

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