By Lauren Bikoff, MLS
The COVID-19 pandemic created challenges for the EBSA and benefit plans.
The Department of Labor’s Employee Benefits Security Administration’s (EBSA) enforcement efforts focus on encouraging retirement and health plans to comply with ERISA and restoring benefits that were improperly held from plan participants. According to the Government Accountability Office (GAO), in fiscal year 2020, almost 84 percent of EBSA investigations were civil and more than 16 percent were criminal, resulting in over $3 billion in payments to participants and plans (GAO Report, GAO-21-376, May 27, 2021).
EBSA is charged with protecting the rights of participants in employer-sponsored benefit plans. As of fiscal year 2020, this included about 154 million participants in 722,000 retirement plans and 2.5 million health plans with combined assets of over $10.7 trillion. To identify violations, EBSA investigates benefit plans and their service providers. EBSA prioritizes investigating cases that may result in large recoveries or affect many participants, such as restored retirement plan contributions or payment for incorrectly denied medical claims. When agreement cannot be reached, investigators can refer civil cases to DOL’s Office of the Solicitor for civil litigation. Criminal cases are referred to Department of Justice.
The GAO noted that the COVID-19 pandemic created a number of immediate and long-term challenges for EBSA and benefit plans. For example, according to stakeholders, plans were initially concerned about how to implement provisions in the Families First Coronavirus Response Act and the CARES Act, but those concerns were addressed as the agency issued FAQs and notices. Similarly, EBSA officials reported that court closures temporarily slowed criminal cases, but as virtual hearings increased, litigation resumed. Stakeholders and EBSA officials also described potential long-term challenges, including difficulties locating the many participants who may have left a job due to the pandemic and may be unaware they left behind retirement funds.
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