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It’s a common refrain: “ERISA sounds familiar, but…”

Blog / By Michelle Kershner • July 28, 2021
It’s a common refrain: “ERISA sounds familiar, but…”

ERISA is the Employee Retirement Income Security Act, a federal law that governs the structure of employee benefit plans. Failure to comply is complicated and costly. ERISA covers many types of employee benefits including health insurance, FSAs, life insurance, wellness programs, and more. If you offer any type of employee benefits, there is a good chance that ERISA affects you.


ERISA requires employers to provide certain copies of benefit plan documents to participants and beneficiaries, file Form 5500, and provide a summary annual report to participants. Insurers rarely provide the documents required by ERISA, which requires plan sponsors (employers) to also furnish a “Wrap Document,” a supplementary document that “fills in the blanks” and complies with ERISA regulations. “Wrap” documents, aka “Mega-Wraps” or “SPD Wraps” affords employers the ability to satisfy the requirement of providing Summary Plan Descriptions for every one of your employer-sponsored plans, by providing just one (1) document – the “Wrap”. This cuts significant legal fees and it also maintains legal compliance, specifically as a Summary Plan Description for every Plan you sponsor must be given to every participant within 90 days after the participant becomes covered. Now with a “Wrap” you only have to send out one document – not 7, 10 or more!


In addition to the savings in legal fees and administration costs, once a Wrap is created, the requirements to file form 5500, for every plan you sponsor with 100 or more participants, now gets easier – in that you only have one 5500 to file per year, saving you thousands per year in accounting fees!


BEWARE! Many employers rely on their brokers or plan administrators to provide all the required ERISA documents. We at SyncStream know better and have developed a partnership with myHRcounsel LLC to provide you with an actual “Attorney-drafted”, “Attorney-reviewed” and “Attorney-backed” product to protect you from fines from the federal government!!


The federal government has stepped up ERISA enforcement in recent years and there could be big consequences for employers who are out of compliance. Employers have been fined $86,500 for failing to file a complete and accurate Form 5500 and $241,000 for failing to provide SPDs and other documents to plan participants!

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It’s a common refrain: “ERISA sounds familiar, but…”

ERISA is the Employee Retirement Income Security Act, a federal law that governs the structure of employee benefit plans. Failure to comply is complicated and costly. ERISA covers many types of employee benefits including health insurance, FSAs, life insurance, wellness programs, and more. If you offer any type of employee benefits, there is a good chance that ERISA affects you.


ERISA requires employers to provide certain copies of benefit plan documents to participants and beneficiaries, file Form 5500, and provide a summary annual report to participants. Insurers rarely provide the documents required by ERISA, which requires plan sponsors (employers) to also furnish a “Wrap Document,” a supplementary document that “fills in the blanks” and complies with ERISA regulations. “Wrap” documents, aka “Mega-Wraps” or “SPD Wraps” affords employers the ability to satisfy the requirement of providing Summary Plan Descriptions for every one of your employer-sponsored plans, by providing just one (1) document – the “Wrap”. This cuts significant legal fees and it also maintains legal compliance, specifically as a Summary Plan Description for every Plan you sponsor must be given to every participant within 90 days after the participant becomes covered. Now with a “Wrap” you only have to send out one document – not 7, 10 or more!


In addition to the savings in legal fees and administration costs, once a Wrap is created, the requirements to file form 5500, for every plan you sponsor with 100 or more participants, now gets easier – in that you only have one 5500 to file per year, saving you thousands per year in accounting fees!


BEWARE! Many employers rely on their brokers or plan administrators to provide all the required ERISA documents. We at SyncStream know better and have developed a partnership with myHRcounsel LLC to provide you with an actual “Attorney-drafted”, “Attorney-reviewed” and “Attorney-backed” product to protect you from fines from the federal government!!


The federal government has stepped up ERISA enforcement in recent years and there could be big consequences for employers who are out of compliance. Employers have been fined $86,500 for failing to file a complete and accurate Form 5500 and $241,000 for failing to provide SPDs and other documents to plan participants!

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