In terms of issues over retirement plans for the past 22 years, the two most treacherous investigations that I went through with the Department of Labor (DOL) over the plans sponsored by clients, simply started by a complaint by a former employee.

The smallest issue can be blown out of proportion because an aggrieved former employee just wants to stick it to their former employer. Something as simple as screwing up the mechanism of distributing money to these former employees can lead to a DOL complaint. Former employees are far more likely to complain than current employees because they have nothing to lose.

That’s why it’s important for the plan sponsor to tread carefully in all aspects of plan administration when dealing with former employees.