DOL Reminds Employers to Self-Audit Their Plans:

On July 24, the DOL published a blog article titled “How self-audits help build a culture of compliance and trust.” The  article announces the DOL’s launch of its “expanded self-audit compliance assistance initiative.” With respect to employee benefit plans, the article states that self-audits “help the regulated community proactively assess and improve compliance with the labor laws we enforce” and enable plan sponsors “to identify and fix potential violations, reduce the likelihood of litigation, and demonstrate a good-faith commitment to following the law.”

The article also notes that self-audits “help ensure that workers get the protections and benefits they are entitled to — like…benefits security.” In this connection, the article reminds plan sponsors about the DOL’s Voluntary Fiduciary Correction Program (for fixing ERISA fiduciary violations and prohibited transactions) and the Delinquent Filer Voluntary Compliance Program (for filing overdue Form 5500 returns).

Although not discussed in the article, the IRS has an extensive correction program for fixing most retirement plan document issues and operational issues. The program is called the Employee Plans Compliance Resolution System, and it is currently found in Revenue Procedure 2021-30. Self-audits are also important under that program. That is because its provisions are much more employer-friendly if issues are discovered during self-audits, instead of during an IRS plan audit.