Employee Retirement Income Security Act The (ERISA), the federal law governing private pension, group life and health plans, making it the plan requires that participants will receive a document called a summary plan description ( “SPD”). While the SPD was drafted in accordance with Section two Labor regulations, does not have to be called “The Brief Description Plan.”
What is Covered in the Summary Plan Description of?
The SPD is a detailed document that gives information to scheme participants on how the scheme operates and is managed. Among other things, the SPD clearly stated in a language easy to understand the following items:
- Description or a summary of the benefits of
- The name of the plan, sponsor and administrator
- funding mechanisms
- guidelines and eligibility Participation
- Methods of Calculation for the service and benefits
- vesting schedules Budd
- Benefit payment procedures and timing
- Claims submission process
- Claims appeals process
- Address for service of legal process
- Circumstances that could lead to incompetence or denial of benefits
- Statement of ERISA rights participants and other technical notices
Questions could still be a participant in the plan after reading the SPD will be answered by contacting the plan administrator.
Summary Plan Description When Must be Provided?
every plan administrator to provide a copy of the SPD for participants in the following circumstances:
- When the new scheme comes into force
- When a worker becomes eligible to participate in the scheme
- At the written request of a plan participant or beneficiary
Are there any exceptions to the Summary Plan Description?
daycare and welfare plans provided by an employer for managers and workers compensation are exempt from the requirement very SPD. There are no exemptions from the requirement SPD for small plans covering fewer than 100 participants.
Frequency Summary Plan Description must be updated?
If the plan is amended or modified within a period of five years, a new SPD must be distributed to participants. If there is no change, the original SPD are distributed to plan participants every ten years.
A “summary of material modifications” may also be used to inform plan participants plan changed significantly.
What is Common Errors SPD can lead to ERISA Litigation?
Administration or mistakes could lead to disputes ERISA litigation include, but are not limited to:
- Failure to follow the procedures described in the SPD
- Conflict between the SPD and the basic design of any document describes or summarizes
- failed to disclose clearly the circumstances which may lead to reduced benefits, forfeitures, or bans
- failed to provide planning documents in a timely manner
Overall, ERISA provides clear procedures that must be prohibited closely followed by the plan sponsors and administrators. Any questions should be directed to ERISA compliance attorney experienced in ERISA matters.