Severance plan filings

[alexa]

What type of severance plans require a Form 5500 filing?

If filing is  required, how does one determine participant count? Is it all active employees eligible for the plan?

Do you need to include those who have severed still receiving severance benefits?

1 of our subs who also has a separate severance program has never filed a Form 5000 (since 2015). Assuming should have is the DOL delinquent filer program the only option. active employees currently eligible for 2019 is 211.

Thanks

Alexa

 

ps. 1 follow-up : we do exclude in another section of plan compensation "long term disability payments" but STD is not mentioned here

[Alonzo Church]

The count is all employees who would receive severance on the measurement date if they were involuntarily terminated. Per the Form 5500 instruction, an employee is a participant in a welfare benefit plan: "the date on which the individual becomes eligible under the plan for a benefit subject only to occurrence of the contingency for which the benefit is provided".

[Luke Bailey]

alexa, not all severance plans are subject to ERISA. It depends on a somewhat (but not wholly) nebulous test based on the U.S. Supreme Court Fort Halifax Packing case, which you might want to Google. If the plan is not subject to ERISA, it would of course not be required to file a 5500, but would be required to comply with the requirements of applicable state law.

If 5500's were required but not filed, the DFVCP is open to severance plans as welfare benefit plans.

[alexa]

HI Luke

A little late replying

we had an erisa plan which I filed late filings through the DFVCP process; luckily capped at $4k:)

Alexa