• Retaining Employee Benefit Plan Records
  • March 13, 2004
  • Law Firm: Ford & Harrison LLP - Atlanta Office
  • There are two different record retention rules under the Employee Retirement Income Security Act of 1974 ("ERISA"). In the December issue of Management Update, we discussed the requirement under ERISA §107, which involves records to verify the accuracy of any reports filed under Title I of ERISA. This article discusses the requirement under ERISA §209(a)(1), which involves records relating to benefits payable to plan participants.

    Under ERISA §209(a)(1), every employer must maintain records sufficient to determine benefits due or which may become due to employees. Proposed DOL regulations issued in 1980 provide that individual benefit records must be retained "as long as a possibility exists that they might be relevant to a determination of the benefit entitlements of a participant or beneficiary." Although the DOL issued a notice in 1993 that suggested it was prepared to consider reasonable time limits on record retention, to date it has not issued any follow-up guidance. As a result, employers should assume that records regarding plan benefits must be maintained indefinitely.

    For pension (defined benefit and defined contribution) plans, the types of records that should be maintained would include the following:

    1. Demographic data regarding employees, including date of birth, hire date, plan participation date, hours of service during plan years of participation, compensation during relevant plan years, and class of employment (e.g., collectively bargained, salaried, etc.);

    2. Documents, including plan documents, plan amendments, trust agreements, summary plan descriptions, summaries of material modifications, notices to participants, etc.;

    3. Contribution records, such as salary reduction agreements, payroll records, transmittal records, and deposit records;

    4. Records regarding distributions from the plan, such as completed distribution elections, copies of distribution forms packages, check copies, applications for loans and in-service withdrawals, etc.;

    5. Copies of qualified domestic relations orders, beneficiary designations, investment election forms, etc.; and

    6. Copies of all communications with participants regarding their eligibility for and the amount of their benefits, including records regarding any appeals made by participants.

    In addition to the records described above, welfare plans (medical plans, life insurance plans, disability plans, etc.) should also maintain insurance applications, COBRA notices, certificates of creditable coverage, claims information, medical records, eligibility determinations, etc.