To steal a joke from Chris Rock, when I worked at a TPA as the lead ERISA attorney, I used to joke that if you wanted to hide something from one of our plan administrators, just put it in the plan document file. Nobody ever cracked one open. Why? Because someone had already plugged the plan specs into Relius, and that\u2019s all anyone looked at.<\/p>\n
The problem, of course, was that the woman running the show back then was a complete buffoon. Things were constantly wrong \u2014 specs didn\u2019t line up, operational errors piled up, and everyone assumed Relius was the gospel truth. Meanwhile, the plan document \u2014 the actual governing instrument under ERISA \u2014 sat ignored, like an unread instruction manual stuffed in a drawer.<\/p>\n
Here\u2019s the point: plan specs are only as good as the plan document they\u2019re based on. If they don\u2019t match, you\u2019re courting disaster. I\u2019ve seen plan sponsors dragged into compliance nightmares, IRS corrections, and even litigation simply because the specs in the recordkeeping system didn\u2019t mirror what was written in black and white.<\/p>\n
So, whether you\u2019re a TPA, advisor, or plan sponsor, don\u2019t treat the plan document like some dusty artifact. Specs, procedures, Relius entries, prototypes \u2014 all of it needs to reflect what\u2019s actually in the governing document. Otherwise, you\u2019re just building mistakes into the system and waiting for the IRS or DOL to find them.<\/p>\n
Trust me, when they do, you won\u2019t be laughing at the Chris Rock joke anymore.<\/p>\n
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