Sheet Metal & Air Conditioning Contractors’ National Association

Trustee Advisor Blog

This blog educates industry trustees to aid them in better fund operations in order to control costs and provide quality benefits to fund participants.

DOL Takes Aim at Apprenticeship Fund Trustees

Nov 09, 2011

Trust Experts

The Department of Labor (DOL) is in the process of issuing guidance to multiemployer plans, and in particular, it is providing guidance to trustees of multiemployer apprenticeship plans aimed at allowing plans to police themselves.

The first piece of guidance was posted to the DOL’s website and addressed leasing arrangements for office and classroom space. The guidance is available here. Those of you with leasing arrangements should review it in addition to the Sept. 1, 2011 blog post.

Phyllis C. Borzi, assistant secretary of labor for DOL's Employee Benefits Security Administration, speaking at the International Foundation of Employee Benefit Plans' 57th Annual Employee Benefits Conference on Oct. 31, indicated that much of the DOL’s early guidance would be aimed at apprenticeship fund trustees. Borzi said that apprentice funds were receiving particular attention because DOL investigations across the country showed widespread ERISA violations--some of which “curled my hair”. She believes that many of the violations stemmed from:

  • Failure of trustees to monitor the plan operations
  • Failure to have written procedures regarding fees and expenses
  • Failure to have internal expense controls
  • Failure to have proper written plan documents

“The worst thing that could happen both for the participants in these plans and for the employers that are such an important part of the governance structure of the plan is for Congress to decide that these are scams, and that these are areas in which the money is just being ripped off,” she said.

Borzi indicated that the DOL is unsure what form additional guidance will take but it could be a series of FAQs (frequently asked questions), a list of best practices, some sort of checklist, or a combination of all three. Whatever form it takes, this blog will continue to bring it to your attention.