Five Benefits Of General Data Protection Regulation

general data protection regulationThe European General Data Protection Regulation has attracted a lot of attention recently, but a lot of the focus has been on the huge (multi-million dollar) fines that a business could be hit with if they were found to be in breach of the regulations and they failed to protect the data of their customers. Vendors and suppliers are pushing that side of things as a way to boost sales for the products and services that they offer. The cost of being non-compliant is simply too great to ignore.

Focusing on the punitive issues that are associated with General Data Protection Regulation (GDPR) is unwise, however, because there are some huge benefits to working towards compliance, and really business owners should be embracing the regulations as a motivator to help them make their business better, instead of focusing on the potential fines that make GDPR seem like an unnecessary burden.

Positive One: Improving Your Cyber Security

There is no excuse for being ignorant about cyber-security these days. Data breaches can cause downtime, are bad for PR, and can cause significant financial loss for you and your customers. Take cyber security seriously. The general data protection regulation legislation coming into effect is a good starting point for making your workflows more security-conscious.

A part of the legislation specifies that organizations must identify a security strategy, and take steps to improve their technical systems, to protect citizen’s personal data. It is almost impossible to regulate the integrity of a specific type of data (e.g. customer data) while leaving the rest of your IT environment behind. The regulations will force you to evaluate and improve your overall systems, and will force you to examine the rest of your infrastructure, build efficient workflows, and be systematic about security monitoring. This means that your organization will be less vulnerable to attacks, and you will experience viewer virus outbreaks, and be a less appealing target for low hanging fruit style attacks and exploits. This is one area where investing will save you money.

Positive Two: Better Data Management

A major part of compliance is knowing what information you currently hold on people. You will need to audit the data that you have, so that you can minimize what you are collecting and holding, and organize storage around that, as well as refining the way that the data is managed. Getting rid of redundant, obsolete or trivial files that do not have any business value is a good starting point. This means getting rid of old customer data that you do not need – things that hold no value to your organization, and that could actually pose an unjustifiable risk to your business if you were to keep it and it were then to get leaked as a part of a data breach.

Once you have analyzed all the data that you hold, you can start implementing mechanisms to fulfill other future requirements – such as making data searchable, and indexing it. This will benefit you in the future because if a customer decides to exercise their right to be forgotten then you will be able to comply with it. You can simply search for their data and remove it all in one go, thanks to the easily searchable systems that you have set up.

Positive Three: Improved Marketing Return On Investment (ROI)

A big part of the general data protection regulation comes down to ensuring that you have the consent of the person whose data you hold, and that you process that data within the confines of that consent. This means that you should purge ROT information, and make sure that all marketing leads opt-in. If you get rid of all of that ‘dead’ data, and purge lost leads and people that don’t want the info, you will have a lean, fine-tuned set of data that consists purely of people who definitely want to read your messages or get your calls. This means that you can experiment with niche marketing, you can tailor your messages to specific people, and hopefully get a much better response rate overall. The General Data Protection Regulation is forcing people to appreciate the value of quality over quantity and rewards people who spend their budgets wisely.

Positive Four: More Trust and More Loyalty

GDPR compliance is something that will help your business to form much stronger, more trusting relationships with the general public and with your customers. When you are gathering people’s consent to use their data, you have to explain to them what you are asking them to consent to. This means that your customers feel more comfortable because they can see that you are being transparent, and that you have a systematic approach to how data is being handled. General Data Protection Regulation makes it easy to show that you care about privacy, and that you will treat customer data responsibly.

Positive Five: Improve Your Business Culture

Today, it’s normal for businesses to be eco-friendly, animal-friendly, LGBT-aware, and generally ethical. That is something that did not seem possible as recently as ten years ago. Why not make the new culture be ‘privacy-friendly’, especially as we live in such a data focused world. The GDPR is all about making those initial steps towards respecting your customers, and this is something that will help you to get into the right frame of mind to foster an environment where customer privacy comes first.

Yes, complying with the General Data Protection Regulation legislation is difficult but it is something that is worth doing. Take this opportunity to review and revise your processes and put together an organizational structure that will encourage you and your employees to do things right, whether that means thinking about how you store data and what you store, thinking about what you collect from your customers, or thinking about how you communicate with them and what drives your marketing. It’s not going to be easy to bring your business into line with the GDPR if you have been doing things more casually for a long time, but it will make your business more sustainable, and make it look better for your customers, and your partners.

Are Your Qualified and Nonqualified Employee Benefit Plans in Compliance With the New ERISA Disability Claims Regulations?

Effective for cases filed after April 1, 2018, employee benefit strategies controlled by the Worker Retirement Earnings Safety Act (ERISA) have to follow the US Division of Labor’s brand-new disability insurance claims laws.

What do the new regulations call for?

The purpose of the new guidelines is to guarantee full and also fair insurance claims assess procedures for any type of decision whether a complaintant is “disabled” in regards to an ERISA plan.

In many aspects, these expanded requirements mirror the protections that were added by the Patient Defense and Affordable Care Act (ACA) for certain group health insurance plan claims, such as requirements to avoid disputes of passion, as well as to make sure that rejection notifications are delivered in a “culturally and also linguistically proper way.” The policies additionally take on the ACA requirement to notify plaintiffs if the strategy is based on a decision on any kind of proof or reasoning taken into consideration, trusted, or created by the claims manager (or at its instructions) during the pendency of the appeal, and to offer the plaintiff with enough time to respond before a damaging benefit resolution is made (although they do not embrace the ACA guideline automatically providing the strategy more time to render a decision in such instances).

In many areas, the demands for special needs insurance claims are much more onerous compared to the ACA group health plan demands. Rejection letters for disability claims need to consist of the following aspects that are not required for other ERISA plans:

  • a conversation of the decision, including a description of the basis for disagreeing with or not following: (1) the views provided by the complaintant of health care as well as vocational professionals that treated or assessed the claimant; (2) the views of medical or vocational experts whose guidance was aquired in support of the strategy in connection with a claimant’s adverse advantage determination; and (3) a special needs determination concerning the plaintiff made by the Social Safety And Security Management; as well as
  • either: (1) the certain internal policies, standards, procedures, requirements or other comparable standards of the strategy trusted in making the adverse advantage determination; or (2) a statement that such policies, standards, etc. do not exist. (Team health plans, in contrast, might instead specify that a rule, guideline, method or similar standard was trusted without defining its identification, and also supply a copy at no cost upon demand).

With respect to initial insurance claim denials, the notice should also consist of a declaration that the claimant is entitled to obtain, upon request and at no cost, reasonable access to and also copies of all papers, documents and also various other information appropriate to the claim.

Relative to appeal denials, the notice should include a description of any kind of plan-specific restrictions duration that relates to the plaintiff’s right to bring a civil action, consisting of the schedule date on which the legal constraints duration runs out for the claim.

Which fringe benefit strategies need to be updated for the brand-new disability cases policies?

All ERISA employee benefit plans that have issue upon a determination that a claimant is handicapped go through the brand-new regulations. Plan enrollers ought to be conscious that special needs resolutions may be part of any kind of type of ERISA fringe benefit plan, not just those giving long-term or short-term special needs benefits. Group health and wellness strategies often prolong insurance coverage beyond age 26 for grown-up kids that are handicapped, as well as life insurance policy plans that frequently offer a costs waiver for participants who are entirely disabled. Some certified as well as non-qualified retirement or delayed compensation strategies include special provisions for handicapped participants, such as accelerated vesting or early retirement choices.

Not all plans have an advantage on a complaintant’s disability, nonetheless, have to be changed in order to conform. For instance, where a plan does not provide for its own fiduciaries to make a resolution of handicap, however rather accepts the determination made by the manager of one more plan (like the company’s long-standing handicap plan) then only the terms of the various other plan should be changed. Examples include health insurance that expand eligibility, or postponed settlement strategies that give increased vesting, to claimants that are receiving benefits under the company’s long-term impairment plan or Social Security Impairment Insurance (SSDI).

Also if a strategy gives for its very own fiduciaries to make a resolution of disability, it may not need to be separately modified if the plan’s terms incorporate by referral the handicap insurance claims and also allures procedures of an additional plan that has been amended. In such situation, the strategy’s fiduciaries should adhere to the brand-new procedures, and to update the cases and appeals rejection notices to adhere to the brand-new guidelines.

In short, it is only those ERISA pre-preparations that condition an advantage upon a resolution that a complaintant is handicapped, where the strategy fiduciaries themselves have the discretionary authority to identify if an individual is impaired, and where the strategy includes its very own procedures for making such determinations, that need to be modified. Plans with this layout attribute and will likewise need to issue a Summary of Product Modifications (SMM) to inform participants of the changes, as well as modify their claims as well as allures notifications.

ERISA strategies that are not likely needed to earn modifications to comply with the brand-new regulations consist of:

  • those that do not condition any benefit upon a determination that a claimant is disabled
  • those that accept an impairment decision from an additional strategy or celebration, such as the employer’s long-term handicap strategy or the Social Safety And Security Management
  • those that incorporate by referral the cases as well as appeals procedures of an additional plan that has been updated

If a plan is affected by the new case regulations, what actions should intend enrollers take and by when?

  1. Identify which strategies are affected. The very first step is to take an inventory of your ERISA benefit strategies and also figure out whether the strategy: (1) conditions an advantage upon a resolution that a plaintiff is impaired; (2) provides that the plan fiduciaries themselves have discretionary authority to identify if a participant is disabled, or accepts the decision made by one more plan; (3) has its own procedures for making such decisions.
  2. Changes should be executed by the end of the strategy year, as well as SMMs describing the changes must to be distributed to individuals no later than 210 days after the end of the plan year. Strategies where the fiduciaries themselves make a decision of special needs could want to consider amending the strategy to approve the resolution of handicap by another plan (such as a long-term impairment plan) or the Social Safety Administration.
  3. Where the strategy fiduciaries themselves have discretionary authority to figure out if an individual is handicapped, they will require to make such resolutions in conformity with the brand-new treatments for all types of cases filed after April 1, and also need to guarantee that insurance claims allures denial notifications that have been updated to comply. Also where the strategy has actually passed on optional authority to an insurer or Third-Party Administrator (TPA) to make such resolutions and also problem denial letters, the insurance company or TPA could need to personalize their conventional notification templates to accommodate distinct stipulations of the company’s strategy.

ERISA Procedures For Disability Provider Plans Went Into Effect April 1

For employers that sponsor a disability benefit plan governed by ERISA, March and April of 2018 represent an important period of time.

Claims filed later than April 1 must be in compliance with a new Department of Labor rule issued back in December of 2016. Among the plans falling under this umbrella are certain qualified retirement plans, health and welfare plans as well as non qualified plans for deferred compensation. The purpose of the new requirements is to boost disclosures to participants in the plans and to increase impartiality of those who make decisions concerning the plans.

Categories Of Affected Plans

In a general sense, the new regulations are applicable toward any plan that falls under the auspices of the Employee Retirement Income Security Act (ERISA). Every plan, including those related to disability benefits, that involves the claims adjudicator of that plan to make disability determinations before rendering a payment decision is part of the new layout. Thus, all employers need to take a fresh look at plans providing benefits, waiver of accrual allocation rules or accelerated vesting due to disability.

Impact On Qualified Retirement Plan Operation

It may be necessary to update retirement plans if their plan administrators are charged with determining disability. But, if such determinations are made by third parties such as the Social Security Administration or other entity, there may be no need for an update.

While it is true that non qualified deferred compensation programs largely fall outside of the ERISA regulations, they are subjected to the statutory claims regulation rules. As such, these plans will require compliance with the new rule if their administrators are the ones to make disability decisions.

Implications For Welfare Plans

The majority of plans covered by ERISA are in fact insured, and therefore broadly speaking, it is the disability carrier’s duty to make changes to claim processes and procedures. Employers and/or plan administrators ought to communicate with the insurers to ensure that coverage certificates will be appropriately updated to achieve compliance with the new rule by April 1 of 2018.

Short-term disability plans that are self-insured and that qualify as a payroll practice may also not require revision, given that they are exempted from ERISA. It should be noted, though, that administrators of such plans may wish to adopt part of even all of the final rule’s provisions, in keeping with best practices. Also, it is important that summary plan description documents and wrap plans be updated and disseminated to all plan participants.

Key Changes Within The New Rule

Every claim and appeal must now receive adjudication in a way that fosters the impartiality and full independence of those making benefit decisions. Much like the rules pertaining to group health care plans promulgated as part of the Affordable Care Act, determinations related to the compensation, hiring, promotion, termination or other issue impacting an adjudicator must never be made with an eye toward the chances that individual will support benefits denials.

Bolstered Disclosure Rules

First, a claim denial, whether at the first denial stage or later as part of an appeal, must have as part of it a discussion about the decision itself. This should include the rationale for any disagreement with the vocational expert, treating doctor or other expert who assessed the claimant; the opinions of experts secured by the plan; and a Social Security Administration disability determination offered to the plan by the claimant.

Furthermore, a denial notice needs to include all guidelines, internal rules, standards and protocols utilized in rendering an adverse claim decision (or in the alternative, a statement that no such criteria exist). There also must be a formal statement that the claimant at issue is entitled to be provided with all relevant documents upon request.

Right To Receive, Review And Refute New Facts Prior to Decision

So that all reviews are full and fairly rendered, plans are required to give claimants all new evidence or rationales used in making the benefit determination. This material must be provided to the claimant immediately and with enough advance time before the decision date so that a response by the claimant is possible. This way, claimants have an opportunity to present their side at the level of an administrative appeal instead of having to wait until the issuance of a denial.

Exhaustion Of Remedies

In cases where a plan has not met all of the claim procedural requirements, normally a claimant would have been declared to have exhausted all available administrative remedies and a lawsuit against the plan could be commenced. But, plans can still be in compliance if their rule violation was deemed non-prejudicial, de minimis, the result of good cause or something the plan could not control, made in the context of a good faith exchange and not part of an overall pattern of violation.

Rescission of coverage is in and of itself an adverse benefit adjudication. Rescission of disability coverage made retroactively is also an adverse determination and is subject to the appeals process. It must be noted that termination of coverage because of premium nonpayment does not equate to a coverage rescission.

It is necessary for all notices to be rendered in a manner that is both linguistically and culturally proper. In the same vein as the ACA rules pertaining to group health care plans, if the relevant claimant’s address of record is within a country with more than 10 percent non-English speakers, claim denial documents must be accompanied by a statement in the appropriate language, indicating how language interpretation services may be accessed.

Disclosures Regarding Contractual Limitations Time Frame

Plans with restrictions on the time period available for claimants to file lawsuits need to include on their denial notices information regarding this limit. For instances, if the relevant state has a normal limitations period of five years, but the plan’s contract states that the period is just three years, denial notices must state this fact along with the exact expiration date. Best practices suggest that this type of notice should also accompany denial notices for group health plans and other plans.

Ultimately, every employer potentially affected should make certain to review the new regulations alongside their plan documents to ascertain which rules are relevant to their activities. Furthermore, updates to SPDs should be promptly undertaken in order to achieve full compliance with the new disclosure measures outlined above.


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Stay Compliant With An Annual Wrap Form Review

Its time for an annual review and update of your wrap form documents.

If you would like to stay compliant with your business, you may want to consider doing an annual wrap form review. It’s always good to review the performance of your company, and by doing so, you can identify certain aspects of your business that need to be improved. This is true with not only companies, but individuals. You may be in charge of people that your company that you are having to review on an annual basis. It is only through these reviews that positive changes can be made and problems can be addressed. Let’s look at how you can stay compliant with an annual wrap form review.

Why Annual Reviews Are Always Necessary

Reviews are always going to be necessary for a business. You could have a small company, or a very large corporation. The reviews that you subject your company to could be looking at departments, individuals, or even managers. The reason that you need to have this done at least once a year is to keep track of problems that may be occurring. This could lead to loss in revenue, or even legal problems. When you know what’s going on with every aspect of your business, this can make it more compliant with local laws and regulations that you should be focused on.

The Importance Of Staying Compliant

Compliance is a scary term for many but in the world of business, it is in reference to rules and laws that must be abided by. There will always be state and federal laws and codes that you must follow, and within the context of your business, there are rules and regulations that you have likely set up. When employees are not aware that they are causing problems, or when departments are not compliant with rules that must be adhered to, this can cause a lot of problems. You could find yourself in the midst of a lawsuit, or at the very least, departments may cause your business to lose money.

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How To Conduct Annual Reviews

Annual reviews should be done with each individual that is part of your business. You will want to do this with all of your workers in each department. Then, you will want to interview the managers or department heads to talk to them about not only the employees, but their own performance, to make sure they are on track. It is also possible to benefit from reviewing the president of the company, CEO, or CFO. These people are experts in their industry, but they are being paid top dollar for their services. You need to make sure that they are compliant in every way that they must be.

Will It Take Long To Review Everyone?

It will not take very long to interview everyone that is part of your business. You can set up times to interview each person that is there. Once this is done, you can evaluate this information, make recommendations to individuals, and every department that you have as part of your company or corporation. Those that choose not to do this are at the mercy of mistakes that can be made every day. Unless people are alerted to performance issues, or not being compliant with laws and regulations, they will continue to do so without knowing. Once they are made aware of problems that they may be causing, or rules and codes that they are violating, it is now up to them to get back on track.

To stay compliant, it is important to use annual wrap form reviews that can help your company stay profitable. Compliance with laws and ordinances is something that simply must be done. If you haven’t done this before, it’s a great place to begin to develop this relationship with everyone in your company, plus they will know that you are holding them accountable for their performance. You can find out more about annual wrap form reviews and get the guidance you need by contacting us. Compliance with rules and regulations, as well as laws and ordinances, is something that must be done, and these reviews can help resolve any adverse situations.

It’s Time To Review Your Wrap Documents For Benefits Compliance

When you have a lot on your plate, it’s easy to forget to complete important tasks. If you haven’t taken the time to review your wrap documents for benefits compliance, now is the time for you to give those documents a closer look.

You Should Look At Your Wrap Documents Sooner Rather Than Later

It’s not at all unusual for people to put off reviewing their wrap documents. Because people don’t see this as a pressing issue, people often wait longer than they should before they take a closer look at these documents. In some cases, people don’t bother to look at these documents at all.

You shouldn’t assume that this is something that you can put off indefinitely. If your wrap documents aren’t fully compliant, you’re going to need to address that. If you look at these documents now, you’ll have more than enough time to take care of the issues that you spot.

It’s Important To Review Your Documents Closely

A lot of people only glance at their documents when they review them. While a quick glance can help you to identify some issues, it may not allow you to spot every problem. You should take the time to read over all of these documents closely. Go over each and every word. Make sure you know exactly what the documents say.

If you don’t have a lot of knowledge about wrap documents, you may want to have an expert look at the documents for you. They’ll be able to tell you whether or not the documents in question are fully compliant.

If Your Documents Aren’t Compliant, You’ll Want To Make The Necessary Adjustments

If you do spot issues when you look at your documents, you’re going to want to fix them. It’s important to make sure your documents are completely compliant. If your documents aren’t compliant, you could run into a lot of problems.

Adjusting your documents can take some time. If you know you need to make adjustments, but don’t know what you need to do, seek assistance from an expert. They’ll go over your documents with you and ensure that they are completely compliant.

Look At Changes And Updates

Even if your documents were compliant the last time you looked at them, they might not be compliant anymore. It’s important to be aware of changes so that you can adjust your documents as necessary.

Before you take the time to look over your wrap documents, you should look over the requirements for benefits compliance. As long as you know what the requirements are, you’ll be able to make sure you are meeting every one of those documents.

Seek Out A Second Pair Of Eyes

You may not want to be the only person looking over your wrap documents. If possible, you’ll want to ask someone else to look at these documents with you. They may be able to spot things that you wouldn’t have caught on your own.

These documents are extremely important, which is why you should look at someone else to look over them for you. If you have two sets of eyes, you shouldn’t miss anything important. You’ll be able to catch everything that you need to catch, and you’ll be able to ensure that your documents are compliant in all of the ways that they need to be.

You Don’t Have To Do Everything At Once

Reviewing documents isn’t something you have to complete in a single night. You can review your documents one page at a time. If you’re overwhelmed by all of the documents you have to review, you shouldn’t do everything at once. This is a challenge that you can tackle little by little.

If you don’t feel like you have enough time to review your wrap documents, you should try to break this task up. If you take things on one page at a time, you’ll eventually be able to get everything done.

Don’t put off reviewing your wrap documents. If you review documents now, you’ll have more than enough time to make any needed adjustments. Now is the ideal time to look over your documents and make sure they’re fully compliant. Start looking over these documents as soon as you possibly can.


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Business Compliance Requirements And Consequences You Should Be Aware Of

Regardless of whether you’re starting up a new company, incorporating your business, or forming a LLC, you’ll need to be aware of the compliance requirements for businesses. It’s a serious error to not address these requirements of compliance.

Small business owners frequently neglect such requirements and find that they are in a lot of legal trouble for not paying closer attention. Such compliance requirements are mandatory if you want your business to grow.

If these requirements aren’t met, or if they’re not completed in a timely fashion, the company may lose the status as a corporation or as a LLC. These are serious consequences and you’ll want to ensure that you’re following all such regulations to ensure the longevity of your business.

If the compliance requirements aren’t followed, the company can go bankrupt and may have to sell everything to pay the debt. If you wish to avoid such a situation, it’s vital that you understand the limited liability of your company and protect the LLC status of your business.

After a business has been incorporated, or after they’ve formed a LLC, they must prepare to follow some compliance requirements. Failure to do so in a timely fashion can have serious consequences including having to sell the entire business to pay for the failure to follow the compliance regulations.

There are two types of requirements. Those that are internal, and those that are external. Internal requirements must be taken when the company has a limited liability or they have directors and shareholders, members, or the managers who will be present.

While these may be overlooked, internal requirements must be kept track of and documented in company records. These records may be required when the company is in a lawsuit or other legal type situation.

There are different types of corporations. There are C corporations and S corporations and there are very strict internal requirements for each. One such requirement is that they must hold the initial and annual director meetings as well as shareholder meetings. Here, they will have to adopt bylaws and issue stocks to their shareholders. They must record all such transfers as well.

Although LLC aren’t held to the same strict requirements, they still have to have agreements, issue membership shares, and record the interest of transfers and hold an annual meeting of members and managers. They must use a compliance kit to ensure that they are always in compliance and focus on what must be kept track of to maintain their company.

This kit should include the bylaws as well as the operating agreement. They must keep track of stocks and certificates and a transfer ledger. They must also have their meeting minutes at hand and keep all of them in case they are required for future reference.

External requirements are different in that the state that the business operates in is the one that governs these requirements. They must have state compliance requirements and these will include annual state filing and an annual report. They must pay the state fees and keep track of all of this in ledgers that they can present should they be required.

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Businesses must pay all of the required fees to the state and keep track of the receipts in case they need to show them at a future date. Everything should be accurately documented and kept track of in the record keeping.

There are serious consequences at the state level that can happen if the business isn’t in compliance with the requirements. Each state will have slightly different requirements and regulations so it’s vital to stay in touch with the proper authorities to ensure that all of the compliance requirements are followed to the letter.

If a business isn’t in compliance, they can lose their business license and will go out of business. They may also owe a large amount in fees for not being in compliance. There are ways to get assistance should there be any questions and many corporations and businesses actually hire a compliance manager to make sure that all of this is taken care of in the proper fashion to keep the business running smoothly. Following all of the compliance requirements will go far to help keep a business flowing smoothly.


Benefits Compliance Consultants, Inc. offers this blog for general informational purposes only. The content of this blog is not intended as legal or accounting advice for any purpose, and you should not consider it as such advice or as a legal opinion on any matters.

How ERISA Benefits Compliance Consultants Will Help Your Business

There are many law and accounting firms that will claim to provide the best assistance in ERISA compliance. Of course, it’s always disappointing when you receive a letter describing your non-compliance state as well as hefty fines for each employee. With the experienced and best ERISA benefits compliance consultants, you can avoid any of these costly surprises. You need consultants who can build a strong relationship with your business and provide exceptional knowledge and expertise in everything related to ERISA compliance.

You should find benefits compliance consultants with proven results, prior experience and guarantee a position of overall compliance. That way, you can always stay ahead of the Federal fines that might be imposed on you because of non-compliance. With the best ERISA consultants, you can always avoid the hassle of collecting the necessary paperwork or data and also keep the business operations running without any interruptions. Remember, there should be a process already in place to ensure that all the relevant compliance paperwork is completed and stored properly for easy access by the necessary parties.

As your ERISA compliance consultants we would set up the process effortlessly. That way, it can work in tandem with the scope of your business without any interruptions. If you run a business that’s successful enough to hire employees, you’re on the right track but you need to invest in your employees accordingly. You need to be in compliance with the Federal and local state regulations and laws. Here’s what you need to know about ERISA compliance to make sure your business hasn’t broken any rules.

What Is ERISA?

Created in 1974, ERISA stands for Employee Retirement Income Security Act. It is a Federal law detailing the type of information that should be filed and collected for employees to receivebenefits. The law has stated the minimum amount for voluntary pension as well as the health plans that should be used in the private sector. The Act provides enough protection for individual employees who are covered in such plans. Of course, it’s important to adhere to federal laws to avoid hefty fines but there are many more reasons why ERISA compliance is important.

For instance, it’s a good way to show respect to all the employees who play an important role in your business. Keep in mind that these people always commit their time and lives to the success of your business. According to the law, the management needs to compile proper paperwork of all the employees receiving the benefits. Most of the benefits included in the act include health insurance, retirement, welfare and much more.

The ERISA Act provides the relevant requirements for employers on how to handle their employees’ benefits. ERISA consultants teach your HR department everything there is to know regarding the legal requirements covering the act to guarantee compliance. Keep in mind that welfare plans for employees cover everything from disability, accident, death, medical, hospital access, surgical and accident benefits.

It’s quite often to forget that unemployment insurance benefits are facilitated through employer contributions that are administered through payroll assignments. The ERISA plan is also part of unemployment in relation to taxation of the employer and new hire forms. It also touches other areas such as days off, scholarships, legal services, training plans, severance, daycare and retirement programs.

ERISA consultants will describe in detail how the employer coverage plans actually work. There are many forms that should be filled and also making annual reports to the IRS, retirement plans and health funds. Therefore, you need to take enough time to find the best consultants for your ERISA compliance needs to make sure everything is being done right.


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Letter 226-J Benefits Compliance Notification Received By Office?

What is the Letter 226-J Benefits Compliance Notification and What Does it Mean for An Employer?

Letter 226-J benefits compliance can be an intimidating topic. The letter 226-J is a latter that is sent to applicable large employers (referred to as ALEs) to inform them that they might be liable for something called an ESRP. This stands for employer shared responsibility payment.

To figure out whether an ALE might be liable for such a payment and how much they need to pay the government looks at the information that was provided by the employer in the 1094-C and 1095-C forms, as well as information that individual employees have provided in their own tax returns.

You will need to read the letter, and any attachments, carefully, to understand the process and the payment that the government thinks you are responsible for. The letter will also explain what you need to do next, and how to appeal if you think that the ESRP amount is incorrect.

Along with the letter, you will have been sent a form Form 14764 which you will need to fill out. That form will ask you whether you agree or disagree with the letter. If you disagree, then you will need to provide a full explanation of why you disagree, and indicate any changes that you want to see made. There is another form, called Form 14765, which will allow you to do that. Make sure that you get your response sent off by the deadline.

If you agree with the liability, then follow the instructions provided, and sign the response form, then return it along with payment in full. There is an envelope provided for this.

If you are concerned that the amount is incorrect, then you should check not only the letter, but also the information that was reported on 1094-C and 1095-C.  If that information is inaccurate, then the IRS will not be able to calculate the ESRP payments correctly. Make sure that you keep hold of a copy of the letter, as well as any documents that you submitted, because they will all be needed if there is any need for an appeal.

If, for some reason, you are unable to do this task yourself, you can use Form 2848 to notify the IRS of Power of Attorney and to file a Declaration of Representative. This will allow another nominated person to deal with this on your behalf. The Form 2848 should specifically state the year that the declaration is for, and also note that it relates to the Shared Responsibility Payment.

Note that the ESRP itself is not a bill. Rather, it is a notification that you may be liable, and a proposal for a bill. You will need to review the letter, and the attachments, and complete the form by the date that is stated on the letter. After you respond, the IRS will review your response, reply by sending you an acknowledgement letter and notify you of their final decision.

If you still disagree with the decision, then you will have the right to appeal, and this will be laid out in the acknowledgement letter.

Do not delay when replying to the letter. It is important that you communicate promptly so that you can get all of the information to the IRS before it becomes a pressing matter. If you are late to answer them, then you may find yourself being penalized, and you will find that the appeals process should you disagree with the payment will be more onerous.

If you and your employees have provided accurate records throughout the year, then the letter should be correct and it will only be a matter of answering it and providing the payment that is requested. If you have budgeted correctly throughout the year then you will find that the payment should be around what you expected, and not an issue. If you are going to struggle to pay the amount due, then call the IRS as soon as possible to discuss your options, because failure to deal with these issues can leave you and your business in a crippling situation that is most likely bad for business.

End of Year ERISA Benefits Compliance For Your Business

Is your business  prepared and setup properly for a prosperous and compliant new year?

Many of us tend to approach the start of a new year with a degree of optimism in mind. When we own a business, however, the new year can be something to look forward to but the end of the year can be a stressful time that is full of uncertainty. To be certain, taking care of things at the end of the year as far as benefits and compliance are concerned is vitally important. Not only does it help you to your wrap the previous year up nicely, it allows you look forward to the new year with a renewed sense of vigor.

One of the factors that need to be considered in this regard is to get your business compliance ready for the year’s end. At times, this may require that you get a workers compensation policy and if that is the case, you need to consider many different factors that are going to affect how that policy is handled in the coming year. For example, how often are you going to pay and what is the expiration date with your current carrier? You also need to consider the worker’s comp claims that may have happened in the recent past as well as some information about the business and the owner of the business as well. These are all factors that can make a difference and they are part of a simple checklist to get your company compliance ready.

Other factors that need to be considered very carefully are the benefits and these need to be compiled and put together by the end of the calendar year. In some cases, notices may need to be distributed to employees from the insurance health marketplace. This is something that needs to be done in order to keep you in compliance and to avoid any problems that could occur as a result of not sending out that notice. In addition, there may be health insurance benefits that are available for certain employees and notice may be given to them within a certain amount of time they become eligible.

There are many other factors that can help to get your benefits ready for the end of the year but they really depend on what type of benefits you are offering. If you have a retirement plan in place for your employees and perhaps you are vesting some of the money that they are donating, you may need to consider the eligibility for some of your employees for the retirement plan. They may want to get on board with the new year and they should be informed they are now eligible.

Health insurance is also a very big factor that needs to be considered, especially with some of the major changes that took place in recent years. Many employers are going to need to provide health insurance for their employees or at the very least, they are going to have to provide the opportunity for the insurance to be accepted under group rates. This may require that you crunch the numbers, including figuring out how many full-time employees you currently have because that can make a difference in your need to participate in the health insurance program.

When there are health insurance options available, it is necessary for you to notify any full-time employees that you have on staff that they may be eligible for insurance coverage. Included in that number is anyone who may have been hired in the past year as well as part-time employees who have come on board as a full-time employee. In some cases, you may even qualify for tax credits if you have enough full-time employees that are eligible and taking advantage of the health insurance program.

Does your company offer any benefits in the way of sick time, personal time or vacation time? These are also factors that should be reviewed at the end of the year and any necessary notification should be sent out. Deferred compensation may also be a factor that needs to be considered during this time.

Of course, each business is going to have different options when it comes to reviewing and compiling information for benefits compliance. Some businesses may be relatively small or they may not offer options that would really put them in the line of fire as far as this is concerned. Other businesses, however, hire a lot of employees and in doing so, it is necessary for them to do the paperwork at the end of the year.

Keeping up with paperwork can be difficult but it is a necessity if you want your business to operate smoothly. Take the time to do it now at the end of the year and you will find that the new year goes along much better as a result of your efforts.


Is Your Business ERISA Compliant And Legally Prepared for 2018?

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Summary Plan Description Translation

A plan summary is an important part of your company’s benefits documentation, telling your employees how their healthcare and retirement plans work. An inadequate or poorly communicated plan summary leaves your company and your sponsors open to liability. The plan summary and the communication of it should not be an afterthought, as it is very important to the functioning of the benefits plan. Make sure all of your employees have access to the rights and obligations of their benefits plan.

What about in cases where your employees don’t all speak English? Some employers have many employees across the country who speak a variety of languages; how do you communicate your summary plan description to them appropriately? What are your legal obligation to those employees with regards to their benefits plan.

Unfortunately, there isn’t a simple yes or no answer that applies in all cases. But luckily for the HR department, it’s not that hard to figure out what the answer should be for your company. There are some straightforward regulations that apply in this situation.

The wording in ERISA does not specifically require that SPDs are translated into other languages besides English. However, if your company’s 401(k) plan has more than a specified minimum number of employees on it who can only read a certain foreign language (and they all read the same foreign language), your company is required to give those employees language assistance in order to access their plan documentation.

For plans which have fewer than one hundred participants when the plan year begins, if 25% of those participating can read only the same foreign language, you must provide language assistance to those employees. For example, if your company has 75 employees participating in the benefits plan, and more than 19 of them can read only in Spanish, you will need to provide Spanish language assistance to those participants.

For those plans which have more than 100 participants when the plan year starts, your company is required to provide language assistance if either 10% of the participants or 500 participants all read only in the same foreign language. The requirement applies if your company meets the lesser of the two participant thresholds.

This does not mean that you must hand out translated copies of the summary plan documentation, however. Instead, your summary plan documents must feature a prominent notice somewhere on them, stating that your company is offering foreign language assistance and where that assistance can be obtained. If you need an example of this kind of notice, you can find one on the Department of Labor’s website. https://www.dol.gov

Language assistance doesn’t mean you have to provide written material in the foreign language even at the location where the assistance is offered. Regulations require that the employees are given a “reasonable opportunity” to understand the rights and obligation of the companies benefit plan. This will probably require a native speaker (or a fluent foreign speaker) of the relevant language who has time to work with the employees and understands the intricacies of the plan.

One way to find this person among your employees is to ask for volunteers who are fluent in both the foreign language in question and English. This person becomes the contact person for your company in dealing with plan issues for those employees not comfortable reading in English. This person should definitely be present at any presentations of the benefit plan and any question and answer sessions regarding the plan, since the rapid-fire format is likely to be difficult for non-native speakers.

Beyond the legal requirements, there is also a moral requirement to do right by your employees. The bar is very high for accessing plan documentation in a foreign language, considering how many employees need to be using the same non-English language before the legal requirements kick in. Offering services to employees who don’t speak or read English goes a long way to build morale and company loyalty, even if you aren’t legally required to do so.

Like anything else about benefit plan documentation, understanding translation requirements is important to making sure your company follows all relevant regulations. Luckily, in this case, the rules are relatively straightforward and simple to figure out.