Compliance May 5, 2006

IRS Revises Correction Program with New Corrections

May 5, 2006 (PLANSPONSOR.com) - The Internal Revenue Service has issued a revenue procedure that revises and expands the Employee Plans Compliance Resolution System (EPCRS).
Reported by

According to the IRS the revision incorporates comments from the retirement plans community, particularly on the issues of excluded employees and bad loans.   The procedure adds workable solutions for these issues, the IRS said.

The EPCRS provides a way for employers to correct errors caused by inadvertent oversights. The three levels of the program are:

For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.

  • The Self-Correction Program (SCP) permits a plan sponsor to correct “insignificant operational failures” in certain simple plans, such as 403(b) plans, SEPs or SIMPLE IRA plans.  These corrections can be made without having to notify the IRS and without paying any fee or sanction.
  • The Voluntary Correction Program (VCP) allows a plan sponsor, at any time before an audit, to pay a limited fee and receive the IRS’s approval for a correction of a qualified plan, a 403(b) plan, SEP or SIMPLE IRA plan.
  • The Correction on Audit Program (Audit CAP) allows a sponsor to correct a failure or an error that has been identified on audit and pay a sanction based on the nature, extent and severity of the failure being corrected.

The new revenue procedure is here .

Benefits May 4, 2006

Carnival Cruise Line to Settle Overtime Lawsuit

May 4, 2006 (PLANSPONSOR.com) - Carnival Cruise Lines will pay $6.25 million to thousands of current and former employees that sued the company for allegedly not paying enough overtime, according to the plaintiffs' lawyer.
Reported by

According to the Associated Press, the settlement – if approved by US District Court Judge Marcia Cooke – would force the cruise liner to cough up payouts of between $100 and $150 for the nine plaintiffs leading the suit, and various amounts to as many as 39,500 people who worked on the ship starting November 2001, the newswire reported.

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

Carnival has not admitted any fault in the settlement, but will setup the arbitration process to pay the disputes, the attorney representing the plaintiffs said, according to the AP.

Crew members working for the cruise line are often required to work more than 70-hour work weeks, and the workers filing the suit said Carnival failed to pay them for working the additional hours. Many cruise lines are not governed by the wage laws required by the US because they operate offshore under foreign banners, the AP reported.

«