ERISA Best Practices
- Never back date a plan!
- Keep your documents up to date; review to make sure they have been updated recently.
- Design your plan carefully: Never favor highly-compensated employees on a pre-tax basis: the definition of “highly compensated’ can be tricky: to be safe, complete Non-Discrimination Testing three times a year: before the plan starts, in the middle of the year to check if adjustments to elections are needed, and a final version at the end of the year.
- Make sure you send a copy of summary plan descriptions via a method your employees can access the document (if employees are issued company computers, it is reasonable to distribute via email and retain proof, otherwise: print and mail!)
- Don’t forget Form 5500 Filing, annual notices including GINA and CHIP!
- If an employee asks you for a copy of the plan document, provide them with a copy of the summary plan description right away!
- Make a decision if a wrap document makes sense for you before adopting. Consult with an ERISA attorney first. There are pros that can simplify compliance; but also hooks.