EBSA Expands Compliance Program for MEWAs and Form M-1 Filings

The Employee Benefits Security Administration (EBSA) has expanded its Delinquent Filer Voluntary Compliance Program, offering multiple employer welfare arrangements (MEWAs) an opportunity to submit overdue Form M-1 reports without facing substantial penalties. This development supports regulatory compliance, allowing plan administrators to file late annual reports for a reduced fee, thereby more closely aligning with the compliance requirements under the Employee Retirement Income Security Act (ERISA). This change is crucial for maintaining industry standards and promoting a culture of compliance.

The Department of Labor’s announcement underlines the significance of the Form M-1, a critical document detailing the operations and compliance of MEWAs and entities providing health and welfare benefits to multiple employers. Historically, missing filing deadlines for this form resulted in severe financial penalties for plan administrators. Deputy Secretary of Labor Keith Sonderling stated, “The Delinquent Filer Voluntary Compliance Program has helped foster a culture of compliance and trust by giving plan officials the opportunity to proactively comply with the law." Expanding access to this program represents a strategic effort to aid both workers and employers in meeting legal obligations responsibly.

Currently, the compliance program imposes a $750 fee for late filing of the Form M-1. This aligns with previous updates to penalty caps established in 2002, where EBSA set maximum daily penalties for Form 5500 filings, ranging from $750 for small plans to $2,000 for larger plans annually. This update marks a significant shift in addressing non-compliance among MEWAs, reflecting the industry's commitment to risk management and ensuring that participants benefit from the protections intended under ERISA regulations.