Owners and employees of smaller organizations often find themselves stretched in many directions.  With all of the demands on one’s time associated with operating a business, it is not uncommon to see attention to the organization’s medical and other benefit plans pushed to the back burner.  As a result, smaller organizations tend to rely heavily on their benefits broker for their employee benefit plan documentation.  While brokers can be an excellent resource, plan sponsors need to be aware that the services provided by a broker can vary widely from one broker to the next.

Too often in our mergers and acquisitions practice we see companies being acquired that lack required plan documents and summary plan descriptions for ERISA covered health and welfare plans, lack a Section 125 cafeteria plan for pre-tax payroll deductions of plan premiums, and that have not properly determined whether or not the company is an “applicable large employer” subject to the “pay or play” or employer mandate provisions of the Affordable Care Act.  There is often an assumption by these organizations that their benefits brokers are handling these matters, when in fact they are not, nor has it ever been discussed.

It is ultimately a plan sponsor’s responsibility to ensure that these matters are addressed.  Some brokers provide these services, others do not.