When an employee terminates employment with the company, it is important that we continue to maintain the most up-to-date contact information on file. Having complete and accurate records allows Guideline to respond to a request by the IRS or DOL in the event of a claim by the former employee or an audit of your plan, which may require records dating up to 6 years in the past. One particular area of interest to the IRS in this regard is the plan’s compliance with the required minimum distribution standards for former employees. Furthermore, the Employee Retirement Income Security Act of 1974 (“ERISA”) and current regulations require notices or disclosures to be furnished to eligible employees or plan participants, including terminated employees, when certain events occur. If Guideline does not have accurate participant contact information, we rely on the plan sponsor to locate that individual and furnish them with important notices.
There are several steps you can take to help ensure we have accurate information for all former employees who continue to participate in the plan:
- When an employee terminates employment, remind him or her to continue to monitor and update his or her Guideline account information, including both physical and email addresses, phone numbers, and other important information regarding the plan.
- Inform terminating employees that they should keep their Guideline account information current just as they would with any other financial institution.
- Try contacting the former employee using any available information, such as their last known physical or email address, phone number(s), designated beneficiary(ies), or emergency contact. An attempt to contact him or her using the United States Postal Service (USPS) should always be via certified mail to the last known mailing address.
- Search publicly available records or directories for alternative contact information. For example, Linkedin or other social media accounts have been effective in tracking down missing or unresponsive former employees. Use Guideline’s template letter (available upon request) to let them know we need updated information to send them important plan information.
- If these steps were not successful, retain a commercial locator (skip-tracer) search service or a proprietary internet search tool for locating individuals. Sponsors may retain their own search service or contact Guideline for assistance locating “missing” participants via a commercial search service selected by Guideline.