Wrangle’s ERISA Desk is often asked to provide the distribution guidelines for the Summary Plan Description (SPD), the element of the Wrap Plan Document that must be shared with the Plan Participants. To help provide that guidance, we created the following checklist. Please note, this checklist is intended only as a general guide for the distribution based upon ERISA’s participant disclosure requirements.
If you have any questions about our checklist, please feel free to contact Ann McAdam at amcadam@wrangle5500.com.
SPD Required Recipients & Distribution Deadlines
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REQUIRED RECIPIENTS: |
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| ☐ | Covered employees and former employees: (e.g., active employees, retirees, COBRA qualified beneficiaries)
Eligible employees who waive coverage & ineligible employees do not need to receive the SPD. Covered spouses/dependents generally do not need to receive the SPD (See below). |
| ☐ | Other less common SPD recipients: Covered QMCSO alternate recipients, covered dependents of deceased employees/former employees, representatives or guardians of covered incapacitated employees/former employees |
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DISTRIBUTION DEADLINES FOR RESTATED PLANS: |
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| ☐ | Every 5 years the SPD should be restated and distributed to the required recipients. The deadline for distribution is 210 days after the end of the plan year in which the restated SPD is adopted. |
| ☐ | 90 days after a participant first becomes covered under the plan.
Includes employees who are rehired after the end of the month in which they were terminated. |
| ☐ | Within 30 days after written request by the participant.
Penalties accrue if this deadline is not met! |
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DISTRIBUTION DEADLINES FOR NEW PLANS: |
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| ☐ | 120 days after the establishment of the ERISA plan. This would be the first time the selected plan number is used (e.g. 501). |
| ☐ | 90 days after a participant first becomes covered under the plan.
Includes employees who are rehired after the end of the month in which they were terminated. |
| ☐ | Within 30 days after written request by the participant.
Penalties accrue if this deadline is not met! |
SPD Distribution Methods: Options Will Depend on an Individual’s Computer Access
Plan sponsors should ensure the SPD is furnished by a method “reasonably calculated to ensure actual receipt.” For electronic distribution, this can be accomplished using email with return receipt enabled or by adding a confirmation-of-receipt checkbox to a website. Otherwise, keeping a Distribution Log is considered good practice.
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ELECTRONIC SPDs: |
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| ☐ | Active Employees: Options for those WITH Computer Access at Work (does not include kiosks)
Note that the above electronic distribution methods only work for active employees. |
| ☐ | Employees & Other Recipients: Options for those WITH NO Computer Access at Work
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PRINTED SPDs: |
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| ☐ | Active Employees: Options (with or without computer access at work)
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| ☐ | Employees and Other Recipients: Options
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| Wrangle, an Ascensus® company, as well as its employees and affiliates do not offer legal or accounting consultation or services and does not assist with plan design or implementation. Information provided by Wrangle is for informational purposes only and is not intended to constitute legal or other advice or opinions on any specific matters. The client should always seek the advice of an independent qualified attorney, accountant, or other professional advisor. Wrangle applies its best effort to provide accurate and complete information and provides its service in accordance with ERISA and based on the information provided by the client. This document contains information that is confidential and any use, disclosure, distribution, or duplication by anyone other than an intended recipient is prohibited. Ascensus is not a broker, consultant, or fiduciary, as defined by ERISA. Ascensus® and the Ascensus logo are registered trademarks of Ascensus, LLC.
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