DOL Grants Relief to Benefit Plan Sponsors in California Wildfire Territories

The Department of Labor (DOL) has published employee benefit plan compliance guidance and relief for victims of the California Camp, Hill, Woolsey and other 2018 California wildfires.

The agency says it recognizes that these wildfires may impede efforts by plan fiduciaries, employers, labor organizations, service providers, and participants and beneficiaries to comply with the Employee Retirement Income Security Act (ERISA) over the next few months.

The relief relates to the verification procedures for retirement plan hardships and loans, timely remittance of contributions and loan repayments, and blackout notices.

The DOL says the guiding principle for plans must be to act reasonably, prudently, and in the interest of the workers and their families who rely on their health, retirement, and other employee benefit plans for their physical and economic wellbeing. Plan fiduciaries should make reasonable accommodations to prevent the loss of benefits or undue delay in benefits payments in such cases and should attempt to minimize the possibility of individuals losing benefits because of a failure to comply with pre-established time frames.

In addition, the agency acknowledges that there may be instances when plans and service providers may be unable to achieve full and timely compliance with claims processing requirements. Its approach to enforcement will emphasize compliance assistance and include grace periods and other relief where appropriate, including when physical disruption to a plan or service provider’s principal place of business makes compliance with pre-established timeframes for certain claims’ decisions or disclosures impossible.