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Addressing Disasters & Emergencies: Giant, Large, Medium, Small, Individual

By Jack Towarnicky

Plan sponsors must have the skills of an acrobat – balancing business needs, employee concerns, legal and compliance requirements – and sometimes they must do this against a backdrop of emergencies and natural disasters.   

In the last week, the Internal Revenue Service (IRS, the Department of Labor (DOL) and the Pension Benefit Guarantee Corporation (PBGC) have each issued temporary relief on deadlines and procedural requirements applicable to tax qualified employee benefit plans for plan sponsors impacted by Hurricane Harvey.  So there are immediate actions plan sponsors may want to consider.   

While many plan sponsors will focus on the immediate impact of Hurricane Harvey, plan sponsors might also take this time to plan for the future or to refine existing policies designed to assist employees year-round.   

Don’t look at Harvey as a one-time event – never to be repeated.  On Tuesday, September 5, 2017, the National Weather Service (NWS) reported that Irma became a Category 5 hurricane with sustained winds of 185 miles per hour. Today, September 7, 2017, it is projected to impact Florida.  While the federal agencies haven’t issued relief guidance regarding Irma, such guidance may be coming any day now.  

Just as important, don’t limit your consideration to responding to dramatic natural disasters like Harvey.  Instead, consider changes that will position your plans and human resources policies to meet workers’ everyday needs.  Policies that facilitate accommodating and overcoming the everyday challenges workers face will add to positive engagement, and potentially, favorably impact retention.  

At the same time, consider the precedent-setting nature of any extraordinary actions you take today to respond to Harvey - will you be in position to take similar action in the future?  Given that Congressional and agency responses may vary from event to event, you may want to caveat any actions to clearly designate any changes to your human resources, rewards and benefits policies and plans that are “Harvey-only.” This approach will also confirm any other changes that you have added to address disasters and emergencies – giant, large, medium, small, and individual - as new arrows in your financial, human resources, rewards and benefits quiver.

So, after Harvey, and before any other disaster or emergency, it may be time for plan sponsors to work with their rewards and human resources counterparts to construct or update their emergency benefits policies. 

Much like the diversity of employer responses to the challenge of Financial Wellness, there is a variety of responses available to address the financial and other challenges triggered by natural or certain man-made disasters, including but not limited to:

  • Today – Hurricane Relief for Harvey
    -Qualified Plan Relief
    -Tax Free Disaster Relief Payments
    -Interest-Free Compensation Loans
    -Potpourri of Employer Options / Responses / Alternatives / Guidance•
       -Leave Sharing and Donations
       -Human Resources Policies / Welfare Benefit Plans
       -Employer Sponsored Charities
       -Preparing for What Comes Next / Adding Resiliency – Suggestions From Experts
  • Tomorrow?
    -Long Term Health Consequences
    -Next Up – Irma or …? 

Click here for more information on the above topics. Some are directly related to plan sponsor responsibilities and others are indirectly related. 

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