Federal Employment Law Update – October 2018
October 8, 2018Easy-to-Use Tax Withholding Calculator
October 12, 2018Federal Employment Law Update – October 2018
October 8, 2018Easy-to-Use Tax Withholding Calculator
October 12, 2018
Question: Our company is getting ready for open enrollment. Can we distribute ERISA notices electronically instead of printing and delivering hard copies?
Answer: Yes, electronic delivery complies with ERISA’s disclosure rules – but certain conditions must be met.
First, whether delivered in hard copy or electronic media, ERISA requires preparing and furnishing materials “in a manner consistent with applicable style, format, and content requirements.” It is a good idea to test electronic documents to make sure the formatting and style are correct.
Secondly, materials must be furnished using “measures reasonably calculated to ensure actual receipt.” For instance, if using a traditional delivery method, such as first-class mail, be sure to follow up on any undelivered/returned mail.
For electronic delivery, the compliance rules work differently depending on whether the recipients have regular access to the employer’s electronic information system:
- Regular access means the recipients use the system, such as the employer’s email system or intranet, as an integral part of their regular job duties. This may include employees who work from home or who are traveling. However, simply having access to a kiosk in a workplace common area does not qualify as having regular access.
- Without regular access means all other recipients. This may include employees on leave as well as non-employees such as COBRA participants, retirees, and alternate payees. For this group, electronic delivery does not comply with ERISA unless the recipient first affirmatively consents to receive the material electronically, provides an electronic address, and reasonably demonstrates their ability to access the material in electronic form. Since the process to secure consent is fairly cumbersome, most employers choose to distribute materials to this group using traditional hard-copy methods instead of electronic delivery.
Both groups of recipients must be notified of their rights to receive paper copies of the documents (at no charge), and reasonable and appropriate steps must be taken to safeguard confidentiality of personal information related to benefits. A best practice is for employers to ensure return-receipt or notice of undelivered mail features are enabled. Employers may conduct periodic reviews or surveys to confirm receipt as well.
Just emailing documents or posting them on the company’s intranet or benefit administration portal is not enough. Each time an electronic document is furnished, a notice (electronic or paper) must be provided to each recipient describing the significance of the document.
Get It All
Need information about other benefit notices? ThinkHR customers can log into Comply for practical tips about required notices – and there are a lot of them – and convenient links to sample notices and model language. After you log in to your ThinkHR account, check out our white papers on Timeline of Benefit Notices and Open Enrollment Notices.
About Kathleen A. Berger, CEBS
Kathy Berger is ThinkHR’s principal benefits consultant. She is a Certified Employee Benefits Specialist (CEBS) with over 25 years of experience working with brokers and employers. Kathy uses her extensive knowledge of ERISA, HIPAA, the ACA, and other benefits laws and regulations to assist our clients with practical information in clear language.