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Compliance January 15, 2010
Bankruptcy Doesn’t Relieve Plan of ERISA Mandates
January 15, 2010 (PLANSPONSOR.com)–A Department of Labor (DoL) administrative law judge has rejected the appeal by a 401(k) plan administrator of an $86,500 civil penalty, ruling the administrator’s bankruptcy did not relieve it of requirements to properly file an annual report.
Reported by PLANSPONSOR staff
A news release from the agency’s Employee Benefits Security Administration (EBSA) said the judge ordered the administrator of the Airport Hospitality, LTD 401(k) Plan to pay the penalty as assessed by EBSA.The administrator was charged with not properly filing a Form 5500 for the 2004 plan year because it did not include an acceptable independent qualified accountant’s opinion and an asset schedule.
The DoL judge found the plan administrator had sold its business locations without properly preserving plan records as mandated by the Employee Retirement Income Security Act (ERISA).
“Hotel workers are among the most vulnerable participants we protect,” said Ian Dingwall, chief accountant of EBSA, in the news release. “This case sends a strong message to employers that they must keep personnel and payroll documents for a sufficient time period so they can be checked for accuracy and completeness.”