ERISA Communications Update

The recent Supreme Court ruling in CIGNA versus Amara has created a new benchmark for best practices in employee communications:

• It is the employers’ fiduciary duty to ensure that Summary Plan Descriptions or other Plan Sponsor communications may not provide misleading information.
• Communications to employee benefits must be honest and cannot omit disclosures of material changes, particularly when there is a reduction of benefits. This must be clearly communicated to the employee.
• The language used in the SPD, must be clear enough for the participants to understand. It must be brief and summarize the plan and its provisions.
• There must be a clear process set up for plan communications:
  
  
  • Identify who is qualified and authorized to communicate plan changes.
  • Ensure its accuracy and compliance with ERISA.