Every plan sponsor owns a plan document. Very few read it. Fewer understand it. And almost none use it as the operating manual it was designed to be.<\/p>\n
Instead, many rely on \u201ctribal knowledge\u201d, the memory of someone in HR who has been there since the Clinton administration. That\u2019s how operational errors happen. The plan document governs eligibility, contributions, vesting, loans, QDROs, and distributions. If you operate differently than the document dictates, it\u2019s not \u201cclose enough.\u201d It\u2019s a compliance failure.<\/p>\n
Plan sponsors should review the document annually, especially after mergers, acquisitions, or workforce changes. Make sure operations match the words on paper. When in doubt, ask the TPA or ERISA counsel. A plan document isn\u2019t meant to sit on a shelf. It\u2019s meant to keep you out of trouble.<\/p>\n
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