Compliance Management Tips for First-Time Plan Sponsors
You can’t offer your employees a benefit plan without having to deal with compliance management. As an employee benefits plan sponsor, you'll need to ensure your company is in compliance and functioning effectively in order to protect your business and its employees. How complex that compliance management becomes may vary greatly on the types of plans you offer.
Examples of employee benefit plans
Here are a few common benefit plan types that businesses may offer to their employees:
- Retirement plans
- Health benefits
- Premium Only Plans (POP)
- Flexible Spending Accounts (FSA)
Some employers chose to offer all of these benefit options, while others pick and choose between them. The reasons why they choose particular plans may range from simply wanting to help employees, to retaining top talent, to closing the talent gap with competitors. The more plans you decide to offer, however, the more complex compliance management becomes.
Balancing employee expectations and compliance management
Maintaining a balance between keeping employees happy and the amount of effort required to maintain regulatory compliance has been a significant challenge for employers today. This is due, in part, to the fact that most companies are unsure of where to start or where to turn for assistance with compliance management.
Remember that of the thousands of businesses that offer employee benefits, many started with minimal knowledge of how to manage their plans. So, it’s normal to have plenty of questions when you're first implementing a benefits plan.
Here are a few questions you may encounter as you begin offering benefit plans.
- The more diverse a benefit plan, the greater the regulatory compliance responsibilities. How can you handle the complexity of plan management?
- You’ll likely face increased scrutiny from regulators. How can you be certain that your business is meeting all relevant regulations?
- How can you monitor compliance news and understand when regulatory changes go into effect?
- How will you identify who is responsible for benefit plan administration, such as filing form 5500?
Where to find the answers
Here are a few trustworthy resources where plan sponsors can learn more about compliance management:
If you plan to handle offering benefits plans on your own, may we suggest:
- Regularly reading resources on compliance regulations
- Monitoring your competitors: What type of benefits are they offering? How do your benefit plans compare?
- Have a strong auditing plan set in place before unrolling your benefits. Do you have time to check on the status of your plan on a quarterly basis?
There are also many resources to turn to for third-party assistance while setting up and maintaining your employee benefit plans. But no matter how you decide to manage your benefit plans, it's essential to stay on top of your responsibilities as the plan sponsor to adhere to all relevant regulatory requirements.