U.S. Department Labor Division Recovered $1.2 Billion During 2012 For Employer Benefit Programs

Within the U.S. Department of Labor (DOL) federal agency, its Employee Benefits Security Division (EBSA) oversees employee benefits programs, including about 707,000 retirement plans, 2.3 million health plans, and related employer-sponsored benefits plans (e.g., stock plans, IRA plans). All of these plans cover about 141 million individuals (e.g., employees and their dependents), with assets of about $7.1 billion.

The oversight function by the EBSA includes enforcement when employers violate labor laws. During 2012, the EBSA:

"... closed 3,566 civil investigations, with 2,570 (72.1%) resulting in monetary results for plans or other corrective action. EBSA often pursues voluntary compliance as a means to correct violations and restore losses to employee benefit plans. However, in cases where voluntary compliance efforts have failed, or which involve issues for which voluntary compliance is not appropriate, EBSA forwards a recommendation to the Solicitor of Labor that litigation be initiated. In FY 2012, 218 cases were referred for litigation..."

Also during 2012, the EBSA closed 318 criminal investigations and indicted 117 persons about crimes related to benefits plans. All of that agency activity, including both voluntary and involuntary compliance, resulted in the EBSA achieving about $1.27 billion in monetary results. That's a huge amount of money that employees would have lost otherwise.

Some examples of employer violations and EBSA resolution activity during 2012:

• An Ohio-based company failed to deposit employee contributions into its 401(K) retirement plan and stock plan
• A California magazine publisher ms-managed the company's employee pension plan and was order to restore $364,000 to the employee plan
• A court judge in Illinois found a Chicago-based engineering firm liable for over $33,000 after the firm failed to forward both pre-tax and post-tax employee contributions to its employer-sponsored IRA plan
• A court judge in Pennsylvania found company, that went out of business in 2010, liable for failing to forward assets to retirement plan participants and terminate the plan

Another way to look at this enforcement activity: it's a lot of companies -- a lot of senior executives -- violating wage laws. It's not just low-wage or immigrant employees affected, but white-collar, middle-income employees (and their families) affected.

The EBSA also operates an Informal Complaint process, where employees can submit complaints about alleged violations and abuses. During 2012, the EBSA:

"... EBSA's Benefits Advisors closed nearly 240,000 inquiries and recovered $260.7 million in benefits on behalf of workers and their families through informal resolution of individual complaints..."

This is government working effectively, folks. Employees can submit complaints by contacting the EBSA via its toll-free phone number (1-866-444-3272), or visit www.askebsa.dol.gov.

To read the full report, download the 2012 EBSA Fact Sheet (Adobe PDF, 52.9K). The latest EBSA Fact Sheet is also available online.

I look forward to reading about the EBSA's performance during 2013, despite the 16-day federal government shutdown which cost the country an estimated $24 billion, and which probably hampered EBSA performance.