Plan Sponsors Beware: The Importance of Retaining Employee Benefit Plan Documents

August 14, 2019
Hall Benefits Law, LLC

Fiduciaries and plan sponsors have a number of important tasks that they’re responsible for each year, from making sure employees have help getting their benefit plans set up to handling the different transactions needed to maintain the plan’s records and sending in all necessary paperwork and compliance reporting. Participant notifications are another important task, as is monitoring the changing legislative and regulatory landscape to ensure that all plans remain in compliance. One area of particular importance is retaining records such as employee benefit plan documents for compliance, audit, and your business review.

Plan records, in this instance, constitutes a variety of documents including the plan’s financial records, reporting paperwork, statement audits, benefit determination records, and plan governance records. These records may be prepared and handled by multiple parties from the company sponsoring the plan. They may also be handled by the accountant handling the updating of investment records and the lawyer handling contracts.

ERISA & Department of Labor Requirements

ERISA regulations focus on the retention of plan records that support the administrative filings that accompany a benefits plan. This includes retaining for six years the records supporting the annual submission of Form 5500. This includes copies of the form itself, including schedules and attachments, nondiscrimination test results, employee communications, and related financial records. For the DOL, in conjunction with ERISA Section 209, records relating to determining participant benefits must be retained for as long as they may be required to determine entitlements. For most employers this means that benefits records should be maintained indefinitely. 

HIPAA Requirements

HIPAA requirements focus largely on the protection and privacy of electronically exchanged patient records. This means that records systems should have controls in place to ensure the integrity of the records, that the records can be easily converted to paper form, and that they can be put into a form that is used to satisfy ERISA requirements. 

IRS Requirements

The IRS records retention guidance focuses on maintaining records regarding taxes and verifying the information contained in tax returns. Further, the IRS wants to ensure records are held in a way that a business can grant the IRS access to electronic records. This includes requirements that the records must be maintained in a way that can be read by machine until such a time as the statute of limitations for a particular tax year expires and, in some situations, beyond the statute of limitations.

Hall Benefits Law helps clients comply with data retention laws and regulations. Not only are we paying close attention to changes in regulations, we also have significant experience helping businesses set up processes to stay in compliance and handle audit requests quickly. Call 678-439-6236 today, or visit the Hall Benefits Law website to learn more.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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