Even the most well-designed employee benefits program can create significant legal exposure if communications aren't managed carefully. While HR professionals usually understand major compliance requirements, subtle communication issues often fly under the radar until they trigger regulatory scrutiny or legal challenges. Here's what to watch for and how to protect your organization.
Unintentional Plan Modifications
Benefits communications can inadvertently modify your official plan documents, creating legally binding obligations you never intended. When enrollment guides, intranet content, or benefits presentations contain details that conflict with or expand upon plan documents, these communications can be considered legal amendments to your plans.
A seemingly innocent statement like "We cover all emergency room visits" might be interpreted as a promise to waive certain exclusions outlined in your official plan documents. Courts have repeatedly held employers accountable for such statements, even when formal plan documents contained contradictory language.
Best Practice: Include clear disclaimer language in all benefits communications stating that official plan documents govern in the event of discrepancies. Implement a review process where legal counsel checks all benefits communications for consistency with plan documents before distribution.
Disclosure Timing and Documentation Failures
Regulatory requirements often specify exact timing for benefits notices and disclosures. COBRA notifications must be sent within specific timeframes, Summary Plan Descriptions have distribution deadlines, and ACA documents have their own schedules.
Many organizations distribute the required information but fail to maintain records proving timely delivery—creating significant exposure during DOL audits or participant disputes.
Best Practice: Create a compliance calendar tracking all required benefits disclosures and their deadlines. Establish a system for documenting when and how each communication was delivered, including delivery receipts where possible.
Inconsistent Messaging Across Platforms
As benefits communications expand across multiple channels—emails, intranets, mobile apps, videos, and printed materials—inconsistencies inevitably creep in. These disparities can create confusion about eligibility, coverage details, or enrollment deadlines.
When different communication channels present conflicting information, participants may make decisions based on incorrect details, later claiming they were misled.
Best Practice: Maintain a centralized library of approved benefits language and require all communications to draw from these approved descriptions. Conduct regular audits of all communication channels to identify and correct inconsistencies.
Accessibility and Comprehension Challenges
Benefits communications must be accessible and understandable to all employees. This includes accommodating those with disabilities and ensuring materials can be comprehended by participants with varying education levels.
The DOL increasingly scrutinizes whether communications are reasonably calculated to be understood by the average plan participant. Complex language filled with technical terms fails this standard and creates compliance risk.
Best Practice: Develop materials at appropriate reading levels, provide communication in multiple formats for accessibility, and offer translated versions when a significant portion of your workforce doesn't use English as their primary language.
Privacy Concerns in Benefits Discussions
When addressing employee questions about benefits, HR teams must carefully navigate privacy regulations. Casual conversations about an employee's health situation, family circumstances, or specific benefit utilization can inadvertently violate HIPAA or other privacy requirements.
Best Practice: Train all HR staff on privacy boundaries in benefits discussions. Create private spaces for benefits conversations and establish protocols for handling sensitive information.
Building a Compliant Communication Strategy
The foundation of compliant benefits communication is a comprehensive strategy that includes:
- Regular legal review of all materials before distribution
- Clear documentation of all communications sent and received
- Consistency checks across all platforms and channels
- Plain language principles and accessibility considerations
- A central repository of approved content and messaging
By addressing these hidden compliance risks in your benefits communications, you protect both your organization and your employees while ensuring they can make informed decisions about their valuable benefits.
Benefit Allocation Systems (BAS) provides best-in-class, online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 can Integrate with any insurance carrier for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and many others), and integrate with any payroll system for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and many others).
