FAQs - Which Fringe Benefits are ERISA Plans?

ERISA generally applies to the following benefit plans and fringe benefits, whether they are fully insured or self-insured:

  • Medical, Surgical, Hospital, or HMO Group Insurance Plans
  • Health Reimbursement Accounts (HRAs)
  • Health FSAs (Flexible Spending Accounts)
  • Group Dental Insurance Plans
  • Group Vision Insurance Plans
  • Prescription Drug Plans
  • Group Sickness, Accident, and Disability Insurance Plans
  • Group Life and AD&D Insurance Plans
  • Group Long Term Care Insurance Plans
  • Medical Reimbursement Plans
  • Wellness Programs (if medical care if offered)
  • Voluntary Insurance Plans*
  • Retiree Medical Plans
  • Group Employee Assistance Plans (EAPs) (if providing counseling, not just referrals)
  • Severance Pay Plans
  • Group Business Travel Accident Insurance Plans
  • Prepaid Legal Services
  • Unemployment Benefit Plans
  • Vacation Plans
  • Apprenticeship or other Training Plans
  • Scholarship Plans
  • Holiday Plans
  • Housing Assistance Plans
  • 419A(f)(6) and 419(e) welfare benefit plans
  • Split Dollar Life Insurance Plans
  • Nonqualified Deferred Compensation Plans (if ongoing scheme to determine eligibility/benefits)
  • One employee plans

However, certain self-insured or uninsured plans, such as sick pay, short term disability, paid time off, overtime, jury duty, and vacation pay, may be exempt if benefits are paid:

  • as a "normal payroll practice,"
  • to currently employed individuals (i.e., not retirees, COBRA participants, or dependents),
  • without prefunding or using insurance,
  • entirely from the employer's general assets, AND
  • without employee contributions.

*Voluntary individual or group insurance plans, in which the employees pay all of the cost, and the employer's role is limited to withholding premiums through payroll deduction and remitting them to an insurer, may be exempt from ERISA—depending on the extent of employer involvement. However, even minimal "sponsorship or endorsement" (e.g., a company's name on the brochures) by the employer may destroy this exemption. A voluntary individual or group insurance plan qualifies under the Voluntary Plan Safe Harbor if:

  • it is funded by group or group-type insurance,
  • it is completely voluntary,
  • there are no employer contributions, AND
  • the employer does not endorse the plan.

The following does NOT constitute endorsement:

  • Permitting the insurer to publicize the plan
  • Collecting premiums by payroll deduction
  • Remitting premiums to the insurer

The following MAY result in loss of Voluntary Plan Safe Harbor:

  • Selecting the insurer
  • Negotiating plan terms/linking coverage to employee status
  • Using the employer's name/associating the plan with other employee plans
  • Recommending the plan to employees
  • Saying ERISA applies
  • Doing more than permitted payroll deductions
  • Allowing use of the employer's cafeteria plan
  • Assisting employees with claims or disputes

ERISA generally does not apply to:

  • Cafeteria plans, §125 Plans, POPs (Premium Only Plans), Premium Conversion Plans, Pre-tax Premium Plans (However, the benefits funded by them are often subject to ERISA. NOTE: These plans must be referenced in the plan document and SPD if they are funding an ERISA Plan)
  • Dependent Care Assistance Plans (DCAPs, or Dependent Care FSAs)
  • Health Savings Accounts (HSAs) (if employer involvement is limited. DOL FAB 2004-01, 2006-02)
  • Paid Time Off Plans (PTO)
  • Adoption Assistance Plans
  • State mandated benefits, e.g., STD (if not enhanced beyond mandated benefits)
  • Educational Assistance or Tuition Reimbursement Plans
  • On-site Medical Clinics (if providing First Aid only—not treatment, e.g., flu shots)
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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.