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PBGC Increases Penalties for Failure to Provide Certain Notices in 2019
Practical Law Legal Update w-018-2918 (Approx. 3 pages)
PBGC Increases Penalties for Failure to Provide Certain Notices in 2019
by Practical Law Employee Benefits & Executive Compensation
| Published on 27 Dec 2018 • USA (National/Federal) |
The Pension Benefit Guaranty Corporation (PBGC) issued a final rule that adjusts for inflation the maximum civil penalties for failure to provide certain defined benefit plan notices in 2019.
On December 27, 2018, the Pension Benefit Guaranty Corporation (PBGC) issued a final rule that adjusts for inflation the maximum civil penalties that the PBGC may assess under ERISA Sections 4071 and 4302 (29 U.S.C. §§ 1371 and 1452).
Under the final rule, the maximum daily civil penalty that the PBGC may assess under:
- ERISA Section 4071 for failure to provide certain notices or other material information for single employer defined benefit plans will increase from $2,140 to $2,194 (29 U.S.C. § 1371; 29 C.F.R. § 4071.3).
- ERISA Section 4302 for failure to provide certain multiemployer plan notices will increase from $285 to $292 (29 U.S.C. § 1452; 29 C.F.R. § 4302.3).
These adjustments are required under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, and Office of Management and Budget Memorandum M-19-04.
Defined benefit plan administrators and plan counsel should be aware of these revised penalties for failure to comply with PBGC notice requirements. To learn more about the notice requirements for defined benefit plans, see: