Tune up your clients' benefit programs: even the best-oiled machines need a little energy boost sometimes. If your clients are large companies, review the pitfalls that could jeopardize the tax-favored status of their employee benefit plans.* Make sure that agreements with service providers clearly disclose both direct and indirect fees, including float income, shareholder service fees and 12b-1 fees. Pay only those amounts the Labor Department The Department of Labor (DOL) administers federal labor laws for the Executive Branch of the federal government. Its mission is "to foster, promote, and develop the welfare of the wage earners of the United States, to improve their working considers legitimate plan expenses. Paying other types of expenses can lead to charges of breach of fiduciary duty Noun 1. fiduciary duty - the legal duty of a fiduciary to act in the best interests of the beneficiary legal duty - acts which the law requires be done or forborne and prohibited pro·hib·it tr.v. pro·hib·it·ed, pro·hib·it·ing, pro·hib·its 1. To forbid by authority: Smoking is prohibited in most theaters. See Synonyms at forbid. 2. transactions, as well as the payment of interest and penalties. * Deposit 401 (k) contributions in a timely and regular fashion. Depositing funds quickly even once may be viewed as binding by the Department of Labor and become the standard by which all other deposit times are judged for compliance. * Revise distribution forms to reflect any new regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. . Some plans are currently required to add "relative value" language regarding optional plan distribution alternatives that will require changes in the distribution forms of affected plans. * In the case of health plans, revise the plan procedures and forms to comply with new final COBRA cobra, name for African and Asian snakes of the family Elapidae that are equipped with inflatable neck hoods. The family also includes the African mambas, the Asian kraits, the New World coral snakes and a large number of Australian snakes. regulations. * Review the procedures followed by the company officials who appoint your plan's fiduciaries (typically company directors). If necessary, revise them to make sure they comply with the standards the Department of Labor articulated in high-profile cases such as Enron. * Determine whether items on the plan's form 5500 might raise audit red flags. * Make sure the plan is in a position to impose market-based restrictions on trading if required to do so by the underlying investment or if the plan needs to do so to protect participants' interests. * Impose and disclose in the plan's death-benefit-beneficiary forms who the default beneficiary beneficiary Person or entity (e.g., a charity or estate) that receives a benefit from something (e.g., a trust, life-insurance policy, or contract). A primary beneficiary receives proceeds from a trust or insurance policy before any other. will be if the participant fails to name a beneficiary or if the beneficiary predeceases the participant. Make it clear that only designations contained in the plan-provided form will be reviewed to determine beneficiary status. If the form allows the naming of multiple beneficiaries, make sure it provides a default allocation among those beneficiaries if the participant fails to do so. * Make sure the plan grants the plan administrator sufficient discretion to decide benefit matters, including who is eligible and for what benefit. That way, if a denied claim is challenged in court, the court will review the plan administrator's denial based on whether the administrator's decision is reasonable and not on what the court would have done. Source: Pamela D. Perdue Perdue may refer to:
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