(b)lines Ask the Experts – Dealing With Missing Participants

“I have been reading a lot about missing retirement plan participants lately. If our plan has any, should I be concerned about locating them? If so, what steps should I be taking?”

Stacey Bradford, David Levine and David Powell, with Groom Law Group, and Michael A. Webb, vice president, Retirement Plan Services, Cammack Retirement Group, answer:


Excellent question, as the issue of missing participants has been quite a hot topic, especially with the issuance of recent Internal Revenue Service (IRS) and Pension Benefit Guaranty Corporation (PGBC) guidance in this regard. Furthermore, as pointed out in our Halloween Edition of Ask the Experts, the Department of Labor (DOL) has been quite active in this area as well. And yes, you should be concerned about locating plan participants who have gone missing, since required communications (e.g. account statements, summary plan descriptions (SPDs), summary annual reports (SARs), universal availability notices, etc.) cannot be delivered to such participants, and required plan transactions (e.g. required minimum distributions (RMDs), small balance cashouts) cannot be completed for applicable individuals who are missing as well.


Fortunately, as we pointed out in the Halloween Ask the Experts, many “missing” participants are not actually missing at all, and can be easily located via various methods. The Experts recommend that plan sponsors take the following steps:


1) Obtain a list from your recordkeeper(s) of participants whose mail has been returned as undeliverable. Don’t panic if the list is large—many individuals on such lists are only temporarily “missing”, as it takes a while for some participants who have moved to update their records with all entities with which they have accounts (one of the Experts moved four months ago and is STILL updating some of his account addresses!).

2) Ask the recordkeeper what steps they are taking, or can take, to locate people on the list. Most prudent vendors utilize the Unites States Postal Service’s National Change of Address (NCOA) database on a regular basis and supplement that service by using a private commercial locator service at least once a year. If more than 2% of your plan participants are “missing” at any one time, chances are you need to work with your recordkeeper on enhancing their procedures to locate individuals with bad addresses.

3) For individuals whom your recordkeeper has been unable to locate, attempt to locate such individuals yourself. First, screen the list for any active employees. You would be surprised how many hopelessly “missing” participants can actually be found safe and sound at their desk in the office! After you have done this, there are a variety of other methods you can use to locate such individuals, as follows:

  • Check with payroll or other benefit records (if they are receiving COBRA benefits, for example, it is always good to check with the COBRA carriers, since participants actually receiving benefits are likely to keep their addresses up to date for that purpose).
  • Google them (you would be surprised at how many individuals you can reach this way, if not at a new home address, then at a new work location).
  • If Google turns up nothing, then Google search terms such as “find address,” “find former employees,” or “find a missing employee” and there will be a wealth of free and other commercial services that you can use to locate participants (note: the Experts cannot vouch for the efficacy of any of these services, so you might wish to ask around to see what services other employers are using).
  • If the participant named a beneficiary with contact information, contact the beneficiary—sometimes, these are not the greatest discussions, since the reason that the participant is “missing” is because he/she is actually deceased. However, if that is the case, it is best to initiate the beneficiary claims process than for the participant to be listed as missing on plan records for an indefinite period going forward.
  • Send a notice to the participant via Certified Mail. Though this is not likely to work, in conjunction with documenting the other methods above that you have used to locate an employee, this method provides definitive proof that an employee cannot be reached at the most up-to-date address you possess. This can be quite useful in the event of an audit, as there is a definitive paper trail.

4) Maintain written records of all the actions that you have taken to locate employees—the IRS has already granted audit relief for minimum distribution failures in the event that the plan sponsors has taken reasonable steps to locate participants, and one would suspect that a regulatory body will be more forgiving of other failures regarding missing participants if every reasonable effort has been made to locate same.


Best of luck in finding your participants!



NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.


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