The reporting and disclosure provisions of the ERISA statute appear at §§ 1021 – 1031. These sections –
Create the reporting and disclosure duties of administrators ( 1021);
Describe the summary plan description ( 1022) and annual report (§ 1023) that are the two most important parts of the reporting and disclosure scheme; and
Set forth the timing and details of furnishings and filings (§ 1025 and 1026).
The rest of the reporting and disclosure provisions address peripheral reporting and disclosure issues, including the retention of records (§ 1027), reliance on rulings and regulations as a defense to violations of reporting and disclosure duties (§ 1028), the authority of the Secretary of Labor to issue forms for use in filing reports (§ 1029) or to prescribe alternative methods of compliance (§ 1030), and the repealing of the law that was the forerunner of the ERISA statute (§ 1031).
Section 1021 (a) – (k). Section 1021 enumerates the reporting and disclosure duties of ERISA administrators, as follows:
Section 1021(a). Section 1021(a) clauses (1) and (2) set forth the basic disclosure requirements to participants covered under the plan and beneficiaries receiving benefits under the plan. Section 1021(a)(1) requires the administrator of the plan to furnish the “summary plan description” described in § 1022(a)(1). Section 1021(a)(2) requires the administrator to furnish certain other information to participants and beneficiaries. This information includes:
Defined benefit plan funding notices described at 1021(f);
A copy of the statements and schedules attached to annual reports, described in subparagraphs (A) and (B) of section 1023 (b)(3) and such other material necessary to fairly summarize the latest annual report; and
The pension benefit statements and individual statements found at 1025(a) and (c).
Section 1021(b). Section 1021(b) sets forth in clause (1) the requirement of the administrator to file annual reports with the Secretary of Labor and, at § 1021(b)(2), to file certain reports when a plan is winding up its affairs. Although crucial to the ERISA scheme’s intention to protect these plans through disclosure and oversight, and although § 1021(a)(2) above requires that the administrator furnish parts of the annual report to participants and beneficiaries, these reports have very little direct application or usefulness to ERISA disability plan claims. ERISA disability claims center on the claims process of the individual claim and the decision made to grant or deny benefits, not on whether the administrator has properly managed the plan itself.
Section 1021(c) – (k). The rest of § 1021, comprised of §§ 1021(c) – (k), sets forth a number of other reporting and disclosure requirements. None of these other duties of disclosure and reporting relate to ERISA disability plans. These duties including the sending of notices to participants and beneficiaries of certain events, such as the termination of the plan (1021(c)), funding standards (1021(d)), excess pensions asset transfers (1021(e), defined benefit plan funding notices (1021(f)), the reporting of arrangements for certain multiemployer medical plans (1021 (g)), a proviso that simple retirement accounts require no reporting (1021(h)), notice to participants and beneficiaries of blackout periods (1021(i)), notice of funding-based limitations on certain forms of distribution (1021(j)), a requirement that the administrator furnish upon request to any participant, beneficiary, employee organization or contributing employer copies of certain periodic reports (1021(k)), notice to employers of potential withdrawal liability, and notice to applicable individuals that they have become eligible to exercise their right to divest from an individual account plan.
Returning to the requirement in § 1021(a)(1) that administrators furnish a summary plan description to participants and beneficiaries, the SPD must be furnished in accordance with § 1024(b) and must be “as described” in § 1022(a)(1). Section 1022(a)(1) requires the SPD “shall be written in a manner calculated to be understood by the average plan participant, and shall be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” It goes on to require that any summary of a material modification of the plan also be written in a manner calculated to be understood by the average participant.
Clause (b) of § 1021 requires that an SPD contain a number of pieces of information about the plan. The ones relevant to disability claims and litigation are the following:
The name and type of administration of the plan;
The name and address of the person designated as agent for the service of legal process, if such person is not the administrator;
The name and address of the administrator;
The names, titles, and addresses of any trustee or trustees (if they are persons different from the administrator);
The plan’s requirements respecting eligibility for participation and benefits;
The circumstances which may result in disqualification, ineligibility, or denial or loss of benefits;
The source of financing of the plan and the identity of any organization through which benefits are provided;
The procedures to be followed in presenting claims for benefits under the plan; and
The remedies available under the plan for the redress of claims that are denied in whole or in part, including procedures required under section 1133.
In a certain sense, the SPD is neither fish nor fowl. On the one hand, it is not the plan itself. A plan must be established and maintained pursuant to a written instrument, a requirement that appears in part four, fiduciary responsibilities, at § 1102(a)(1). The written instrument and the SPD may in some cases be one and the same document, but the statute clearly contemplates two distinct writings. On the other hand, for participants and attorneys, it is the plan that ultimately governs the plan, but it is often difficult to know whether there the written plan and the SPD are separate documents, and insurance companies that refer to themselves as “claims administrators” typically take the position that they have no obligation to provide the plan itself, and that claimants or their attorneys must obtain them from the employer or employee organization that the insurer insists is the “administrator” as defined by ERISA.
In any event, the SPD must be published to participants and beneficiaries receiving benefits under the plan within 90 days of becoming a participant or beneficiary pursuant to § 1024(b)(1)(A) or under § 1024(b)(1)(B) no later than 120 days after the plan becomes subject to the reporting and disclosure requirements. Administrators must under § 1024(b)(1) periodically furnish updates every five or 10 years, but must furnish summaries of modifications or material changes within 210 days and summaries of material reductions in covered services or benefits not later than 60 days after such a change. As a practical matter, this ensures that participants of disability plans will likely throw away or file away some number of SPDs and be left scrambling for plan information in the event of a disabling event.