News from Washington, D.C. indicates that although the Department of Labor is conducting fewer audits of employee retirement plans, it is recovering greater sums of money from missing employee contributions. The Labor Department's Employee Benefit Security Administration is responsible for enforcing policies to protect employee retirement funds. While American employers do not have to offer retirement programs and benefits to their employees, once those programs exist, they must follow certain guidelines and procedures in government regulations.
The Employee Retirement Income Security Act of 1974, or ERISA, mandates certain standards for retirement funds. When they are not followed, EBSA can step in to recover the missing monies. In fiscal year 2017, EBSA recovered over $1.1 billion in employee contributions that had gone missing from their retirement funds, up from $777.5 million in recoveries for fiscal year 2016. The increased recoveries came in despite the agency closing 295 fewer cases in 2017.
Fines have increased for companies responsible for ERISA benefits violations, and the administration has become skilled at spotting more significant, larger violations. Beginning in August 2016, the fine for a business that refused to produce benefit statements for their employees went up from $11 per worker to $28 per worker; the fines for refusing to file necessary forms also nearly doubled.
In fact, EBSA is using data algorithms to scan the benefit documentation employers are required to provide. By comparing those documents with bankruptcy filings, news reports and complaints filed by plan participants, the department can more effectively find companies that should be subject to a benefits audit.
Employees who find that they are being denied their retirement benefits or that their funds are less than they should be can file an ERISA benefits claim. A lawyer can work with an employee to pursue a claim and seek compensation for the improper handling of their retirement funds.