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DOL Announces Annual Adjustments to Various Employee Benefit Plan Penalties

by Vita, on January 20, 2017



In 2015, legislation was enacted by Congress that required an initial "catch-up" adjustment to specified penalty amounts, followed by annual adjustments. Regulations were then issued in 2016 that established catch-up amounts and required future adjustments be made by January 15 of each year, starting in 2017. It's important to note that the adjustments announced are effective for penalties assessed after January 13, 2017 for violations occurring after November 2, 2015. 

Highlights of Changes

  • Form 5500 – The maximum penalty for failing to file Form 5500 increases from $2,063 to $2,097 per day that the form is late.

  • Group Health Plans – The maximum penalty for failing to provide the summary of benefits and coverage (SBC) increases from $1,087 to $1,105 per failure. The penalty for violations of the Genetic Information Nondiscrimination Act (GINA) increases from $110 to $112 per participant per day.

  • 401(k) Plans – For plans with automatic contribution arrangements, the penalty for failing to provide the ERISA § 514(e) preemption notice to participants increases from $1,632 to $1,659 per day. The penalty for failing to provide blackout notices or notices of diversification rights increases from $131 to $133 per day. The maximum penalty for failing to comply with the ERISA § 209(b) recordkeeping and reporting requirements remains at $28 per employee.

Topics:Employee Benefits