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Release Date: 07/31/2002
Release Number: 02-16
Contact Name: Gloria Della
Phone Number: 202.693.8666
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Washington, DC
- The U. S. Department of Labor’s Pension and Welfare Benefits
Administration today released guidance to make it easier for the employee
benefit community to use the Voluntary Fiduciary Correction Program (VFCP) in
complying with the Employee Retirement Income Security Act.
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Assistant Secretary Ann L. Combs said, “Today’s guidance clarifies
aspects of the program relating to delinquent employee contributions and the
calculation of money owed to a plan. As part of our ongoing compliance
assistance efforts, we hope this guidance will encourage plan sponsors to use
the program and avoid enforcement actions and civil monetary penalties.
The guidance also will assist service providers who prepare applications under
the program to ensure completeness and accuracy of their submissions.” |
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The final VFCP, published in the March 28, 2002 Federal Register,
allows plan officials, sponsoring employers or parties to affected transactions
to voluntarily correct specific violations of the law. Applicants must fully
correct any prohibited transactions, calculate any losses and restore those
losses with earnings or profits, and distribute any supplemental benefits owed
to eligible participants and beneficiaries. If properly corrected, plan
officials will receive a “no action” letter indicating there will be no
further enforcement action by the Labor Department on the corrected transaction. |
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PWBA received questions and public comments asking for clarification on how
to calculate earnings under the VFCP for delinquent employee
contributions owed to pension plans. The guidance provides answers to
frequently asked questions about specific factual situations and provides
hypothetical examples on acceptable calculations of lost earnings. |
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The new guidance can be obtained on the Internet
or by contacting a local regional office by calling PWBA's Toll-Free Employee
& Employer Hotline number, 1.866.275.7922. |
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U.S. Department of Labor
news releases are accessible on the Internet. The information in this news
release will be made available in alternate format upon request (large
print, Braille, audio tape or disc) from the Central Office for Assistive
Services and Technology. Please specify which news release when placing
your request. Call 202.693.7773 or TTY 202.693.7775. |
