The Department of Labor Has Issued Guidance and Relief for ERISA-Governed Employee Benefit Plans Due to the COVID-19 Outbreak
Oakland, CA – Recognizing that the COVID-19 outbreak may impede plan and plan participants’ efforts to comply with various requirements and deadlines under the Employee Retirement Income Security Act of 1974 (ERISA), the U.S. Department of Labor’s Employee Benefits Security Administration recently released, “Guidance and Relief for Employee Benefit Plans Due to the COVID-19 (Novel Coronavirus) Outbreak” on the DOL’s website. See https://www.dol.gov/agencies/ebsa/employers-and-advisers/plan-administration-and-compliance/disaster-relief/ebsa-disaster-relief-notice-2020-01. As summarized below, the Guidance provides extra time for compliance with certain deadlines and guidance for accommodations due to the COVID-19 pandemic.
The stated relief provides extra time for participants and beneficiaries under health, disability, retirement, and other plans governed by ERISA to make claims for benefits, to appeal denied claims, to seek external review of certain claims, and to comply with deadlines affecting COBRA continuation coverage. ERISA plans also are provided an extension as to identified deadlines to furnish required notices or disclosures to plan participants and beneficiaries so that plan fiduciaries and plan sponsors have additional time to meet their obligations under ERISA during the COVID-19 outbreak, so long as the plan and responsible fiduciary act in good faith and furnish the information as soon as administratively practicable under the circumstances.
The Guidance issued by the DOL generally states, “[t]he guiding principle for plans must be to act reasonably, prudently, and in the interest of the covered 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 timeframes.”
The Guidance applies to employee benefits plans, employers, labor organizations, plan sponsors, plan fiduciaries, participants and beneficiaries, and service providers subject to ERISA, unless otherwise provided. The Guidance is effective from March 1, 2020 (the beginning of the COVID-19 National Emergency) until 60 days after the announcement of the end of the COVID-19 National Emergency, or such other date later announced by the DOL.
Subsequently, on May 4, 2020, the DOL, in conjunction with the Treasury Department and the IRS, published a joint notice in the Federal Register to announce the specific relief and extensions afforded plan participants, beneficiaries, and claimants under ERISA-governed benefit plans. As to the specified deadlines and time periods, ERISA-governed plans must disregard the period from March 1, 2020 until sixty days after the announced end of the National Emergency. See https://www.federalregister.gov/documents/2020/05/04/2020-09399/extension-of-certain-timeframes-for-employee-benefit-plans-participants-and-beneficiaries-affected.
By remaining current on the developments and status of the law on a nationwide basis, MH is equipped to handle ERISA disputes anywhere in the United States. We have decades of experience reviewing, analyzing, and defending ERISA benefit decisions and our attorneys are prepared to assist clients with any aspect of their ERISA business. We represent plan sponsors, fiduciaries, administrators, carriers, and others involved in employee benefit plan and plan asset administration. For more information about our ERISA practice, please contact Blaire Johnson or Charan Higbee.
Originally Published on May 6, 2020