DOL Announces Increased Civil Monetary Penalties for 2023

On January 12, 2023, the Department of Labor (DOL) issued final regulations that contain inflation adjustments to civil monetary penalties, which the DOL administers. These adjustments are required under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. This Act significantly revised the method the DOL used in calculating inflation adjustments for penalty increases by:

  • providing an initial “catch-up” adjustment in 2016 for civil monetary penalties.
  • requiring the DOL and other federal agencies to annually adjust the penalties for inflation (using cost-of-living formula), by January 15 of each calendar year.

The below table reflects the DOL’s 2023 annual inflation adjustments to the civil money penalties for violations of certain requirements (Health & Welfare) under ERISA, effective January 15, 2023. This is not a complete list of all penalties and all agencies’ increased penalties. Please refer to (88 Fed. Reg. 2210 (Jan. 13, 2023)) to review all increased penalties.

The DOL has adjusted the civil monetary penalties eight times since the Interim Final rule was issued on June 30, 2016.

Employers that are in compliance with the ERISA regulations will have little to no concern that these fees continue to increase annually. Employers that are out of compliance with ERISA requirements could find themselves owing thousands and/or hundreds of thousands of dollars to the government for violations if audited. Most employers are not aware they are out of compliance with ERISA.