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 $1,502 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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