The U.S. Department of Labor (DOL) has issued the Federal Civil Penalties Inflation Adjustment Act Annual Adjustments for 2025. As per 2016 legislation, DOL must make certain adjustments to some civil penalty amounts no later than January 15th of each year. The penalty amounts apply to various benefit plan compliance failures and represent maximum penalty amounts. As a result, the DOL can issue lower penalties for some violations in some circumstances.
Form 5500
Most ERISA plans must file Form 5500 annually. The penalty for failure to file Form 5500 has increased from $2,670 to $2,739 every day the form remains unfiled.
Summary of Benefits and Coverage (SBC)
Plans that fail to provide plan participants with a Summary of Benefits and Coverage (SBC) could now pay up to $1,433, up from $1,406 last year.
GINA Violations
Violations of the Genetic Information Nondiscrimination Act (GINA), which include using genetic information to determine eligibility for coverage, can now result in penalties of $145 per participant per day, increasing from $141 per participant per day.
Medicaid or CHIP Violations
A group health plan’s failure to disclose the availability of Medicaid or children’s health insurance program (CHIP) assistance can also lead to penalties of $145 per participant per day, up from $141.
401(k) Plan Disclosures, Recordkeeping, and Reporting
Plans with automatic contribution arrangements must provide plan participants with a required ERISA preemption notice. Failure to provide the notice to participants can result in a penalty that has increased from $2,112 to $2,167 per day.
Failing to provide blackout notices for periods in which participants cannot change their investments, obtain loans on their accounts, or take distributions from their accounts also has led to an increased penalty amount. The penalty has risen from $169 per day to $173 per day. The same penalty also applies to a plan’s failure to provide notice of diversification rights.
Recordkeeping and reporting requirement violations will increase to a maximum penalty of $38 from $37 per employee.
Multiple Employer Welfare Arrangement (MEWA) Filing
Failing to meet the required filings for multiple employer welfare arrangements (MEWA), such as origination filings and annual Form M-1 filings, have risen from $1,942 to $1,992 per day.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution for your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.
Hall Benefits Law, LLC
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