Benefits Myth Busters

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1 Benefits Myth Busters Moderator: Lisa Zimmer Panelists: Heidi Lyon and Kent Sparks 2017 Warner Norcross & Judd LLP. All rights reserved.

2 Welcome Introductions Format myth or truth Questions encouraged 2017 Warner Norcross & Judd LLP. All rights reserved. Page 2

3 #1 Myth or Truth? When we make a mistake, we re legally required to correct it Warner Norcross & Judd LLP. All rights reserved. Page 3

4 #2 Myth or Truth? The Employee Retirement Income Security Act (ERISA) only applies to retirement plans Warner Norcross & Judd LLP. All rights reserved. Page 4

5 #3 Myth or Truth? All expenses connected to a plan can be paid from plan assets Warner Norcross & Judd LLP. All rights reserved. Page 5

6 #4 Myth or Truth? is acceptable for all notices and disclosures Warner Norcross & Judd LLP. All rights reserved. Page 6

7 #5 Myth or Truth? Only very large plans get sued. Litigation Targets: Walmart, Kraft, Fidelity, Lockheed Martin, Caterpillar, Nationwide...Mom & Pop Shop? 2017 Warner Norcross & Judd LLP. All rights reserved. Page 7

8 #6 Myth or Truth? Nondiscrimination testing does not apply to health and welfare plans Warner Norcross & Judd LLP. All rights reserved. Page 8

9 #7 Myth or Truth? A safe harbor retirement plan is exempt from all nondiscrimination testing Warner Norcross & Judd LLP. All rights reserved. Page 9

10 #8 Myth or Truth? With the new administration, I don t have to worry about compliance. There won t be any enforcement Warner Norcross & Judd LLP. All rights reserved. Page 10

11 #9 Myth or Truth? My retirement plan is free Warner Norcross & Judd LLP. All rights reserved. Page 11

12 #10 Myth or Truth? We use leased employees, so we don t have to worry about whether they have employee benefits Warner Norcross & Judd LLP. All rights reserved. Page 12

13 #11 Myth or Truth? We don t have to pay FICA on an executive s deferred compensation until the compensation is paid Warner Norcross & Judd LLP. All rights reserved. Page 13

14 #12 Myth or Truth? If an employee makes a mistake during open enrollment for health and welfare benefits, we can change the election to what she really wanted Warner Norcross & Judd LLP. All rights reserved. Page 14

15 #13 Myth or Truth? The recordkeeper told us most plans do this and we re an outlier if we don t Warner Norcross & Judd LLP. All rights reserved. Page 15

16 #14 Myth or Truth? The insurance policy says that it s an SPD, so we can distribute just that document to participants Warner Norcross & Judd LLP. All rights reserved. Page 16

17 #15 Myth or Truth? If we have the biggest recordkeeper, we can rely on their investment advice due to their reputation. An independent fiduciary advisor would just add fees Warner Norcross & Judd LLP. All rights reserved. Page 17

18 #16 Myth or Truth? A rehired employee can always make new health and welfare benefit elections Warner Norcross & Judd LLP. All rights reserved. Page 18

19 #17 Myth or Truth? A participant electing a lump sum payment instead of an annuity will end up with a richer benefit Warner Norcross & Judd LLP. All rights reserved. Page 19

20 #18 Myth or Truth? We can amend our plan by writing in the margins or communicating the change to participants Warner Norcross & Judd LLP. All rights reserved. Page 20

21 #19 Myth or Truth? We re not responsible for proxy voting Warner Norcross & Judd LLP. All rights reserved. Page 21

22 #20 Myth or Truth We can let participants in an HSA use the telemedicine feature without any additional out-of-pocket cost Warner Norcross & Judd LLP. All rights reserved. Page 22

23 Questions & Answers Thank you! Lisa Zimmer Warner Norcross & Judd LLP 2000 Town Center, Suite 2700 Southfield, Michigan Heidi A. Lyon Warner Norcross & Judd LLP 111 Lyon Street, NW, Ste. 900 Grand Rapids, MI Kent Sparks Warner Norcross & Judd LLP 111 Lyon Street, NW, Ste. 900 Grand Rapids, MI These materials are for educational use only. This is not legal advice and does not create an attorney-client relationship Warner Norcross & Judd LLP. All rights reserved. Page 23

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