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The goals and measures contained in EBSA’s Annual Performance Plan for
FY 2000 supported those contained in the EBSA FY 1997 - 2002 Strategic Plan and
fall under the Department’s 2nd strategic goal-- A Secure Workforce.
EBSA’s primary mission is to protect the pension, health and other
employee benefits of the over 150 million participants and beneficiaries in
excess of 6 million private sector employee benefit plans and $4.3 trillion in
assets. Through its program, EBSA safeguards and promotes the economic security
of workers and families. To accomplish this, EBSA has established the following
agency goals:
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Deter and correct violations of the relevant statutes. EBSA deters
and corrects violations of the relevant statutes by identifying civil
violations and achieving appropriate correction in a cost- effective manner
(i.e. voluntary compliance, administrative proceedings or federal court
action); detecting, investigating and referring criminal violations to
prosecutorial authorities; ensuring that annual reports are filed timely and
accurately; and ensuring that audits of employee benefit plans comply with
professional standards.
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Facilitate compliance by plan sponsors, plan officials, service
providers and other members of the regulated community. EBSA facilitates
compliance through the timely issuance of advisory opinions, exemptions,
regulations, compliance guides and other issuances designed to assist the
regulated community in understanding and complying with its responsibilities
under the law, while removing unnecessary impediments and protecting the rights
and benefits of participants and beneficiaries. These efforts are supplemented
by EBSA participation in conferences, symposia, and programs designed to expand
an understanding of ERISA’s compliance requirements.
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Assist workers in understanding their rights and protecting their
benefits. EBSA assists workers in understanding their rights and protecting
their benefits by disclosing plan documents; develops publications, news
releases, and other educational materials which inform participants of their
rights under Federal law; assists in the development of amicus curiae
briefs to further participant rights and benefits; and maintains a nationwide
participant assistance program which provides written and telephone responses
to participant problems and inquiries.
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Encourage the growth of employment-based benefits. As one of the
principal agencies with responsibility in the area of pension, health and other
employee benefits, EBSA plays a leadership role in the development of
retirement, health and employee benefits policy. EBSA discharges its
responsibilities in this area in a variety of forms including, but not limited
to, maintaining an active research program; continuing its educational outreach
efforts to help plan sponsors and participants understand their rights and
obligations as well as the importance of and options for retirement savings and
health care benefits; and assisting the Administration, other Federal agencies
(e.g. the Departments of Treasury and Health and Human Services, the Internal
Revenue Service, and the Pension Benefit Guaranty Corporation, among others)
and the Congress in the development and/or review of legislative initiatives
affecting employee benefits.
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Goal - Increase by 2.5% the number of closed investigations of employee
pension and health benefit plans where assets are restored (to 819) and
prohibited transactions corrected (to 301).
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Results - The Department closed 1,187 investigations of employee
pension and health benefit plans where assets were restored, an increase of 24%
over FY 1999 (Figure 1). In addition, 538 cases were closed where prohibited
transactions were corrected, an increase of 38% over FY 1999.
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Indicator - Increasing the number of cases with fiduciary results
demonstrates the Department’s success in protecting plan assets. In other
words, where plan assets have been endangered or have been otherwise misused,
the Department seeks to have the transaction corrected to minimize potential
loss or to have the plan made whole through the restoration of assets.
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Analysis - The Department exceeded its FY 2000 performance goals. More
importantly, in FY 2000, the Department continued to improve its quality of
case selection as demonstrated by continuing to increase the number of cases
closed with fiduciary results, a primary strategy to achieving our goal.
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 In FY 2000, the approximately $426 million was restored to benefit plans as
a result of its investigative efforts. Assets that, in the absence of
investigative efforts, would have been lost to participants and beneficiaries.
Because of the volatile nature of recoveries, past performance is not
necessarily indicative of future performance in any given year. However, over
the period of several years, the trend has been upward.
Strategies - During FY 2000, field offices continued to employ more
effective targeting techniques to increase the number of cases converted from
limited review investigations to fiduciary investigations in which possible
fiduciary or criminal violations have been identified. Some offices requested
special computer generated targeting runs designed to identify specific types
of plans (e.g., ESOPs), or investment/asset categories (e.g., those holding
real estate/mortgages or those where assets have been transferred to other
plans). Other offices went directly to financial institutions to assist them in
identifying plans which may have a delinquent contribution problem or which may
have been abandoned by responsible plan officials. In addition, field offices,
via regional projects, targeted issues that were present in their
jurisdictions.
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Goal Assessment & Plans - In FY 2001, we will begin reporting
separate measures for pension and health enforcement to reflect our increasing
responsibilities in the health related enforcement arena. EBSA will also set
more ambitious targets given our recent experience. EBSA will continue to
protect against irregular fluctuations by utilizing a two-year rolling average.
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Goal - Increase by 1% the number of workers who are covered by a
pension plan sponsored by their employer, particularly women, minority, and
workers in small businesses.
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Result - The number of private wage and salary workers in pension
programs increased by 2% from 47.6 million in 1998 to 48.3 million in FY 1999
(Figure 2). With respect to those groups where pension coverage has been
historically low, the increase among women was 2%, among minorities 5%, and
among workers in small businesses 6%.
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 Indicator
- The number of private wage and salary workers in pension
programs. Improving the financial security of Americans during their retirement
years is a DOL priority. More specifically, expanding pension coverage to those
Americans who have historically experienced low pension coverage is of
particular concern.
Analysis - The data suggest that the Department has contributed to
achieving this performance goal that directly improves the lives of American
families, ensuring economic security in retirement.
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Strategies - Many factors contribute to the expansion of pension
coverage, such as the structure and health of the economy (e.g. level of
employment and economic growth, sectoral shifts in economic activity) and
demographics (aging population, increasing numbers of women and minorities). In
addition to these external factors, the Department also contributes through
aggressive educational strategies such as the Retirement Savings Education
Campaign and Partnerships, targeted public service announcements, promotional
cards in tax returns, an 800 telephone line, interactive web sites, and videos
for small businesses to name a few. The Department will continue to
aggressively educate our customers regarding the importance of retirement
planning, particularly participation in pension plans, and anticipates
continued success in expanding pension coverage.
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Goal Assessment & Plans - In FY 2001, we will maintain this goal
and again seek an increase of 1%. We will continue to aggressively pursue
education and outreach, in general, and will continue to target those groups
who have historically shown a lower rate of pension coverage -- women,
minorities, and workers in small businesses. As a result, we anticipate
continued expansion of pension coverage.
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 Goal
- Increase by 2% benefit recoveries for individuals which are
achieved through assistance of Pension Benefit Advisors to $53 million.
Result - With the assistance of Pension Benefit Advisers, the
Department recovered or protected approximately $67 million for plan
participants in FY 2000 (Figure 3).
Indicator - The dollars recovered or protected as a result of
assistance by Benefit Advisers. The Department directly assists plan
participants and beneficiaries to obtain earned benefits as well as understand
their rights and protect their benefits via its participant assistance program.
The direct restoration or payment of benefits to participants without the need
for any protracted or costly litigation is a primary objective of the
Department.
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Analysis - The Department exceeded its FY 2000 performance goal by
approximately 26% and exceeded its FY 1999 recoveries by $5 million or 8%.
While a benefit recovery is an important performance indicator, it still
understates EBSA’s customer assistance impact because of the inability to
quantify certain assistance activities such as restoration of health benefits
where no direct benefit recovery is captured but nonetheless an important
service is provided. EBSA received approximately 155,000 written or telephone
inquiries for assistance this year. EBSA boasts a 98.7% response rate to
written inquiries within 30 days of receipt and a 99.9% response rate to
telephone inquiries by the close of the next business day. A rapid and accurate
response is critical to protecting workers’ benefits. Based on FY 1999 and
FY 2000 results, the Department recovered or protected over $129 million for
plan participants as a result of its customer assistance program, an indication
that the Department is realizing the full benefits of increased staff in its
customer assistance programs.
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Strategies - The Department combines an aggressive outreach and
education program to create an environment that fosters and promotes
knowledgeable consumers who may assist in “policing” their own
benefit rights with a highly motivated and trained staff of customer assistance
experts in the field of pension and health laws. Moreover, the customer
assistance staff have access to a wide array of technical experts throughout
the Department.
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Goal Assessment & Plans - The Department will maintain this goal
in FY 2001 and seek to increase recoveries. In addition, the Department will
participate in the American Customer Service Index (ACSI) initiative sponsored
by the National Performance Review as a means for assessing Americans’
trust and confidence in the information that the Department provides. In
addition, in FY 2002, the Department will undertake more rigorous program
evaluation effort as a means for better understanding which strategies provide
the greatest assistance to the public and help to create an informed public.
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In addition to our results based goals, EBSA has other supporting activities
that contribute to our mission that are both measured and ultimately assist us
in achieving our goals. The other significant activities are a balance between
other enforcement activities, compliance assistance and regulatory activities
streamlining, stakeholder education and outreach, and exemption processing.
Below are noteworthy indicators of our accomplishments in FY 2000.
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Enforcement - The program-specific measure of civil cases opened
increased by 9% in FY 2000 from 4,081 to 4,455. While the number of opened
cases is still below the peak of FY 1998 of 5,858, EBSA continues to emphasize
the quality of case selection for investigation and the positive results
achieved rather than just the number of cases opened. While this transition
continues to result in fewer cases being opened, the benefit of this change has
positive results by increasing the number of cases closed with fiduciary
results by 26% over FY 1999. In FY 2000, the number of civil cases referred for
litigation increased to 212, compared to 178 in the prior year and up from 129
in FY 1996.During FY 2000, EBSA assessed civil penalties of more than $16.7 million.
The civil penalty assessment program was established in FY 1991 under
provisions of the Employee Retirement and Income Security Act (ERISA), sections
502(c)(2), 502(i), and 502(1). Collections of assessed penalties for the past
five years, including interest and other charges, are as follows:
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FY 1996: $13,142,000
FY 1997: $11,285,000
FY 1998: $12,384,000
FY 1999: $13,071,000
FY 2000: $13,043,000
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Customer Assistance - Assistance to participants continues to markedly
increase benefit recoveries for plan participants. In FY 2000, benefit
recoveries totaled $157 million compared to $74 million in FY 1999, up from $23
million in FY 1996. While our increase in Enforcement staff and Pension Benefit
Advisors during this period may be partially responsible for the increase, we
are also achieving efficiencies as a result of technological improvements such
as our automated service for the distribution of information (i.e. pamphlets).
Pension Benefit Advisors are now spending less time responding to routine
information requests and more time actually resolving complex benefit issues.
While we anticipate further improvements as we reap the full benefits of
automation and a seasoned, fully-trained staff, FY 2000's results should be
tempered by the fact that two cases resulted in approximately $70 million
recovery for participants. Therefore, in the absence of these one-time
recoveries, the increase in benefit recoveries for FY 2000 is a more modest $87
million or 18% over FY 99. While an 18% increase is a noteworthy achievement,
it is not something that can be expected every year.
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Exemption Processing - The outputs for exemptions granted decreased
slightly to 173 compared to 198 in FY 1999, while the amount of time to process
an exemption continued to increase. To address this situation, the staff is
implementing a number of measures designed to decrease the overall processing
time for complex, as well as non-complex, cases. These measures include: (i)
earlier review of new exemption applications with the goal of identifying
issues and/or a lack of information which may delay the successful completion
of the case; (ii) earlier telephone contacts and conferences to discuss how
outstanding issues can be addressed; (iii) more frequent reminders to
applicants regarding the need for submitting additional information promptly to
the Department for consideration by appropriate staff; (iv) quicker drafting of
relevant documents for review by supervisors and, whenever possible, shortening
the length of notices which must be published in the Federal Register; and (v)
facilitating earlier determinations by appropriate Department decision-makers
once the record necessary for an exemption is complete. The exemption program
facilitates meritorious investment transactions for pension plans which would
otherwise be prohibited under ERISA. During FY 2000, numerous cases closed were
highly complex, requiring careful attention to develop appropriate safeguards
and conditions to address potential conflicts of interest or other abuses which
increase the risk of loss to plans. Some of these cases were well over one year
old, due to a number of factors which often relate either to an
applicant’s unwillingness to agree to appropriate safeguards or inability
to submit information which satisfies the Department’s needs or concerns.
Continuing to eliminate the more complex and aged cases from the inventory is a
necessary step to reducing average processing time for the coming years.
However, the remaining number of aged, complex cases may still have an adverse
impact on our processing time in FY 2001, despite the success achieved from
implementing the above described measures. We are attempting to mitigate this
impact and hope that, by FY 2002, the benefits of eliminating the aged cases
and implementing new procedures will result in significant improvement in
processing time.
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In FY 2001, we will begin reporting separate measures for pension and health
enforcement to reflect our increasing responsibilities in the health related
enforcement arena. EBSA will continue to set more ambitious targets given our
recent experience. In addition, to protect against irregular fluctuations, we
will continue to utilize a two-year rolling average . Further details as to our
adjustments may be found in the Department’s FY 2000 Annual Accountability
and Performance Report as well as its FY 2001 and FY 2002 Annual Performance
Plans.
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We will also continue to aggressively pursue education and outreach, in
general, and will continue to target those groups who have historically shown a
low rate of pension coverage -- women, minorities, and workers in small
businesses. In addition, during FY 2001 we will be participating in the
National Performance Review’s American Customer Satisfaction Index to
better understand the effectiveness of our customer service program.
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Finally, in late FY 2000, EBSA received a final report from
MRJ, a noted
expert in the field of data validity and results-based management. This effort,
embarked on in early FY 2000 in partnership with the Department to improve
performance measures and to address performance data validation and
reliability, has assisted EBSA to better establish appropriate goals and
measure our performance. We anticipate further benefits from this initiative in
FY 2001 as we consider their recommendations in the broader context of
strategic planning.
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