Payroll made wage deductions, but then what happened to the money?
Unremitted health plan contributions, $12K owed
After you deduct health insurance premiums from wages, if you don’t remit the money to the health benefit plan in a timely manner, that can mean bad news for your company and employees.
That’s what SmartCore LLC learned firsthand.
As part of a consent judgment and order with the federal Dept. of Labor (DOL), the North Carolina company had to pay $21,404 to plan participants to:
- Cover their unpaid medical claims, or
- Reimburse their contributions to the health benefit plan
The DOL’s Employee Benefits Security Administration conducted an investigation of SmartCore during a four-week period in 2016.
That’s when the DOL realized the fiduciaries had failed to remit $14,363 in employee contributions to the plan’s claims administrator, resulting in a total of $52187 in unpaid medical claims.
A settlement in private litigation led to a reduction in the amount of unpaid medical claims. But the fiduciaries were on the hook for the rest.
Value of recordkeeping
Consider whether you can tighten up your recordkeeping system to better track contribution and benefit payments.
Send updates and reminders to others involved in the process for greater peace of mind.
For more info: bit.ly/deduct604