Administering a benefit plan is a complex task. It can be difficult to keep plan documents and procedures up-to-date. A steady stream of changes to federal laws, including the Internal Revenue Code (IRC), the Age Discrimination in Employment Act (ADEA), the Uniformed Services Employment and Reemployment Rights Act (USERRA) and the Americans with Disabilities Act (ADA), adds to this complexity. Even when documents reflect current policies, some human resources staff may not follow the new procedures.
Why do you need an administration review?
Any mismatches between your plan documents and plan procedures can lead to misunderstandings and inefficiency. These incongruities can also make the employer vulnerable to government penalties and participant litigation. Increased enforcement efforts and plan audits by the Internal Revenue Service (IRS) and Department of Labor (DOL) mean that it is more important than ever to document plan procedures and keep them up-to-date.
CrosscheckSM consists of a review and analysis of an employee benefit plan to help employers:
- Determine whether the plan complies with statutory requirements
- Confirm that the plan procedures correspond to what the plan provides
- Reduce expenses by identifying ways to streamline plan administration
- Offer a refresher course and reference guide for human resources staff
- Demonstrate the employer's good-faith effort to comply with IRS and DOL rules
The Crosscheck Review Process
- Step 1: Assessing Needs
The Crosscheck process starts with a discussion between the employer and Sibson compliance consultants to get a detailed picture of how the plan is administered. This helps to identify areas of particular concern and liability and determines how best to use Crosscheck. Based on the results of this discussion, Sibson will work with your legal counsel to create a proposal and determine how results will be presented.
- Step 2: Reviewing Documents and Administrative Materials
Sibson will review your plan documents, summary plan description and all related administrative materials, such as letters and notices to participants. This review forms the benchmark when looking at your plan's actual operations and plan procedures. The review addresses more than 25 topics, including government reporting requirements, claims and appeals procedures and rules governing eligibility and benefits.
- Step 3: Reviewing Administrative Practices
In the next phase of Crosscheck, Sibson interviews the individuals who are responsible for day-to-day plan operations. We conduct the interviews in a conversational and free-form manner, but we structure our questions to make sure we cover the administrative and regulatory areas of most significance to your plan.
- Step 4: Presenting the Results
We present our findings and analysis in a Crosscheck Report prepared with the assistance of legal counsel. The Report is tailored to your organization and, at your and legal counsel's option, may include:
- An inventory of the documents that were examined
- Summaries of interviews conducted
- A detailed discussion of statutory and regulatory requirements
- A review of what the plan document provides
- An assessment of whether the day-to-day plan operations correspond with legal requirements and plan documents
- Areas of administration that require attention
- Our recommendations to legal counsel for resolving potential problems
Since the Crosscheck Report is a detailed study of the plan document and operations, employers may use it as a reference or staff training tool that can streamline plan administration, increase efficiency and reduce expenses while demonstrating a good-faith commitment to comply with federal regulations.