DOL Guidance on COVID-19 Relief for Employee Benefit Plans
February 26, 2021
The Relief May Extend Beyond the Expected Feb. 28 Expiration Date in Some Cases
On Feb. 26, 2021, the Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) issued Disaster Relief Notice 2021-01 to provide guidance on the duration of the COVID-19-related relief regarding certain employee benefit plan deadlines during the Outbreak Period. Under federal law, the period of relief cannot exceed one year.
Because the Outbreak Period began on March 1, 2020, the relief was expected to expire on Feb. 28, 2021. However, EBSA’s guidance interprets the one-year limit to begin on the date the action would otherwise have been required in a given situation. Specifically, individuals and plans will have the applicable periods disregarded until the earlier of one year from the date they were first eligible for relief, or 60 days after the announced end of the Outbreak Period.
Because participants and beneficiaries may encounter ongoing problems due to the COVID-19 pandemic, plan administrators should continue to make reasonable accommodations to prevent the loss of or undue delay in payment of benefits. For fiduciaries that act in good faith with respect to ERISA’s disclosure and claims processing requirements, the DOL’s approach to enforcement will be marked by an emphasis on compliance assistance, and includes grace periods and other relief.
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