Protecting Participants and Beneficiaries: EBSA Enforcement

The U.S. Department of Labor has regulatory and investigatory authority under the Employee Retirement Income Security Act of 1974 (ERISA), and through its Employee Benefits Security Administration (EBSA), works to ensure “the security of the retirement, health, and other workplace-related benefits of American workers and their beneficiaries.” Cybersecurity tops the list of current enforcement efforts, but ERISA attorneys note that plan operations, service provider oversight and benefits administration are also in the limelight.  

Understanding the Role of EBSA

In Field Assistance Bulletin No. 2026-01, in addition to specifically laying out its current enforcement priorities (with cybersecurity topping the list), the Employee Benefits Security Administration (EBSA), provides this summary of its role: 

EBSA is the steward of ERISA and the United States’ voluntary employee benefits system. ERISA was created because employee benefit plans, such as retirement, health, disability and other plans, are of national interest. The continued well-being of these plans is crucial to both employers who sponsor those plans and to American workers and their families who rely upon those plans to provide promised retirement, health and other benefits. The Department periodically reviews and evaluates the responsiveness and effectiveness of its enforcement and regulatory efforts to stay on mission.

Visit EBSA Enforcement for a complete overview of current work, which resulted in the recovery of “$1.4 billion in direct payment to plans, participants, and beneficiaries in FY 2025.” As EBSA explains: “The majority of…monetary recoveries were the result of enforcement actions and informal complaint resolutions.” 

In keeping with EBSA’s policy of encouraging plan sponsors to proactively address oversights and mistakes, the agency also administers The Voluntary Fiduciary Correction Program, and explains: 

• If an investigation reveals a violation of the civil provisions of ERISA, EBSA takes action to obtain correction of the violation. It is EBSA’s policy to promote voluntary compliance with ERISA whenever possible. Making corrections to plans includes paying amounts to restore losses, disgorging profits, ensuring claims are properly processed and paid, and paying penalty amounts (when applicable).
•  Labor Department attorneys work with field offices to provide every opportunity for fiduciaries to comply with ERISA. If the persons involved take the proper corrective action, the Department will not bring a civil lawsuit with regard to the issues involved. 
• When voluntary compliance is not achieved, EBSA may refer a case to Labor Department attorneys for litigation. Plan assets recovered by EBSA go directly back to the plans and participants involved. 

Current Enforcement Priorities?

Given the extraordinarily high standards of ERISA, and the ambitious scope of recent bi-partisan legislation (SECURE and SECURE 2.0) aimed at improving the retirement outcomes of more Americans, EBSA cannot possibly investigate and enforce every issue associated with employee retirement plans. At Groom Law Group, attorneys offer this bird’s eye view of EBSA’s current efforts: 

• EBSA’s enforcement priorities for fiscal year 2026 will likely focus on plan operations, service provider oversight, and benefits administration.  
• EBSA will continue to address cybersecurity risks to employee benefit plans, including governance practices and controls that safeguard plan assets and participants’ information.  
• EBSA’s investigations will prioritize protecting benefit distributions, with particular attention to delays, denials, or errors in processing payments to participants and beneficiaries.  
• The agency will continue to examine fiduciary oversight of retirement plan assets, including whether fiduciaries have followed a prudent process in selecting and monitoring investments, evaluating fees and performance, and managing conflicts of interest consistent with ERISA’s fiduciary standards. 
• EBSA’s 2026 priorities highlight an increased focus on investment strategies used in underfunded defined benefit plans, as well as a focus on 404(c) plans and whether fiduciaries followed reasonable processes when establishing the plan’s investment line-up.

Underscoring that it is essential to “promptly engage ERISA counsel” upon receipt of notice of an EBSA inquiry or investigation, attorneys at Groom Law Group remind us: “DOL investigations can pose significant challenges for plan sponsors, fiduciaries, and in some cases, service providers to ERISA plans, such as third-party administrators.  The most important step for plan sponsors is to ensure that plan governance, procedures, and documentation are in order before any inquiry arises.” 

Reducing The Risks of ERISA Plan Sponsorship

Retirement plan sponsors can be held personally liable for errors or alleged oversights  in how the plan is run, and that liability cannot be eliminated, even through contracting with third party service providers. Under ERISA standards, examples of plan sponsor oversights include failure to monitor service providers, or implement a cybersecurity response plan. Indeed, even a minor cyber incident can spiral into allegations of a fiduciary breach, with sponsors personally liable for the costs associated with defense and penalties. 

Only fiduciary liability insurance (FLI) protects plan sponsors personally, covering legal defense costs and penalties in the event of errors, oversights and allegations.

Colonial Surety Company makes it efficient and affordable for retirement plan sponsors to bundle three essential coverages into one seamless solution for ERISA compliance and protection:

1. ERISA Fidelity Bond: Fulfills your federal mandate to protect plan funds from dishonesty. (Colonial Surety is a direct, Treasury-Listed bond writer).
2. Fiduciary Liability Insurance (FLI): Shields your personal assets, covering up to $1,000,000 in legal defense costs and penalties for administrative errors or oversight omissions.
3. Complimentary Cyber Liability Insurance: Provides $50k of vital protection for the plan and company against regulatory actions following a data breach and directly addresses the DOL’s response plan recommendations.

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