When I started practicing in this area, the focus was on document compliance--given the complexity of the Internal Revenue Code and ERISA requirements and how often they change, what do I need to do to keep my plans qualified? While document compliance is important, outside counsel's value is most important in other areas, both of which relate to risk mitigation. Examples of my work in this area are described below.
Correction of Administrative Errors
In two recent projects, clients discovered that fairly simple errors in administration created a significant financial exposure, either from the government (which would assess steep penalties) or from participants (if they or their lawyers discovered the mistakes and sued for damages AND collected attorneys' fees). My approaches balanced the potential risks against the real cost of alternative courses of action.
Separate Lines of Business
A transaction (like the purchase of a business) can be complicated from a benefits standpoint. (If you know me, you know that I try to characterize all complications and issues as "opportunities." Following a deal, however, it may be hard to see the positive side of the obstacles and the direction can be simple--"overcome them!")
A client had bought another company but for a number of reasons (cost; workforce management), the client kept both its existing 401(k) plan and the target company's 401(k) plan in place. Once the "transition period" in the Internal Revenue Code was used up, the client started to be concerned that the two plans couldn't both pass the Internal Revenue Code "minimum coverage" test on a controlled group basis. That's the test that makes sure that you don't have a plan for your highly compensated employees and another plan for the rest of them.
I know from experience that minimum coverage can get tricky in small and large companies because a relatively small, relatively high-paid group can fail and, whether you are large or small, it's possible to have a "relatively" skewed distribution of high-paids. A lot of lawyers won't even start the analysis. Even though minimum coverage involves fairly simple math, many benefits lawyers adopt a version of the "I didn't know there was going to be math on this test" approach and punt the calculation to the client or its administrators. But, as part of my problem identification, I needed to know whether the plans could pass separately, so I calculated minimum coverage and concluded that one of the plans would not pass.
Having confirmed the problem, I had to solve it. The answer was to qualify the two businesses as separate lines of business. While I won't go into all the detail, the rules in this area are very opaque and, at some point, they require an analysis of the products and services provided to customers of the two businesses. I'm a benefits lawyer, not a product specialist, but I helped the client understand the inquiry and prepared questionnaires that the benefits folks could use to interview the product specialists, so that the important facts could be confirmed and the plans could both be maintained.