Synergy Blog

From Roger Baron – ERISA SPD does not Equal Plan Document

Reprinted with Permission from Roger Baron

In the wake of Cigna v. Amara, I am finding that many ERISA plans are unable to produce a “plan document.”  As a result, plans are making the argument that the Summary Plan Description (SPD) itself serves as the “plan document.”  This argument was rejected in Wilson v. Wal Green, 2013 WL 1799599 (M.D.Fla.), decided 4/29/13.  This is a long opinion but the court’s ruling on this issue is solid and is found on pages *32-33.  Noting that Sedgwick is “arguing that the conferral of authority in the SPD is effective because the SPD is the ‘governing plan document’,” the Court holds at *32-33 (text accompanying footnote 27-28):

ERISA requires that every “employee benefit plan shall be established and maintained pursuant to a written instrument.” 29 U.S.C. § 1102(a)(1) (emphasis added). Further, the written “instrument shall provide for one or more named fiduciaries who jointly or severally shall have authority to control and manage the operation and administration of the plan.” Id. A “ ‘named fiduciary’ means a fiduciary who is named in the plan instrument, or who, pursuant to a procedure specified in the plan, is identified as a fiduciary … by a person who is an employer … with respect to the plan….” 29 U.S.C. § 1 102(a)(2) (emphasis added); Slomcenski v. CitiBank, N.A., 432 F.3d 1271, 1278 (11th Cir.2005) (requiring sponsors to follow ERISA plan amendment procedures once such procedures are adopted); Shaw v. Conn. Gen. Life Ins., 353 F.3d 1276, 1283 (11th Cir.2003)(same). ERISA also specifies what must be included in “[e]very benefit plan.” FN2829 U.S.C. § 1102(b). Specifically, every plan shall:

 (1) provide a procedure for establishing and carrying out a funding policy and method consistent with the objectives of the plan and the requirements of this subchapter,

(2) describe any procedure under the plan for the allocation of responsibilities for the operation and administration of the plan (including any procedure described in section 1105(c)(1) of this title),

(3) provide a procedure for amending such plan, and for identifying the person who has authority to amend the plan, and

(4) specify the basis on which payments are made to and from the plan.

( Id.)

Here … a review of the SPD reveals that it does not conform to all the requirements of section 1102(b). Accordingly, the SPD cannot be “the plan instrument” by which a fiduciary is named under Section 1102(a).

Click HERE to view the opinion.


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