Benefits Monthly Minute UPDATE: Outbreak Period Guidance
This morning, the DOL released EBSA Disaster Relief Notice 2021-01, which provides late-breaking guidance on the “Outbreak Period” relief (as reported earlier today in our February Monthly Minute). Under this new guidance, individuals and plans with timeframes that are subject to the Outbreak Period relief will have the applicable periods disregarded until the earlier of –
- 1 year from the date they were first eligible for relief (note: the earliest date that a disregarded period can begin to run again is March 1, 2021), or
- 60 days after the announced end of the National Emergency (the end of the Outbreak Period).
On the applicable date, the timeframes that were previously disregarded will resume, and in no case will a disregarded period exceed 1 year. The Notice includes the following examples:
- If a qualified beneficiary would have been required to make a COBRA election by March 1, 2020, that requirement was delayed until February 28, 2021, which is the earlier of 1 year from March 1, 2020 or the end of the (ongoing) Outbreak Period.
- If a qualified beneficiary would have been required to make a COBRA election by March 1, 2021, that election requirement is delayed until the earlier of 1 year from that date (i.e., March 1, 2022) or the end of the Outbreak Period.
- If a plan would have been required to furnish a notice or disclosure by March 1, 2020, the relief would end on February 28, 2021, and the notice or disclosure must generally be furnished on or before March 1, 2021.
In addition, the Notice implores plan fiduciaries to make reasonable accommodations to prevent the loss of or undue delay in payment of benefits in cases where affected participants and beneficiaries continue to encounter problems due to the COVID-19 pandemic, and, as indicated in prior guidance, in the case of fiduciaries that have acted in good faith and with reasonable diligence under the circumstances, the DOL’s approach to enforcement will be marked by an emphasis on compliance assistance and includes grace periods and other relief.
KMK Comment: given the DOL anticipates that additional relief may be needed as the pandemic continues, we will keep you apprised of DOL updates and clarifications as they are released.
The KMK Law Employee Benefits & Executive Compensation Group is available to assist with these and other issues.
KMK Employee Benefits and Executive Compensation email updates are intended to bring attention to benefits and executive compensation issues and developments in the law and are not intended as legal advice for any particular client or any particular situation. Please consult with counsel of your choice regarding any specific questions you may have.