Bulletin 6

November 1995

TO: Participating Employers

FROM: Office of the Administrative Manager

RE: Procedures for Overpayments, Underpayments and Delinquent Accounts

This is the sixth in a series of Bulletins issued to assist Employers in their monthly Pension reporting and in better understanding other aspects of the Trust's administration.

An important aspect of the Trustees' and Administrative Offices' fiduciary responsibility is the prompt and orderly collection of contributions due the Trust in accordance with the collective bargaining agreements in effect. Reporting forms for regular monthly contributions are sent to employers at the end of each month. Reporting forms for supplemental billings (i.e., rate increases) and audits are sent as required throughout the month.

The Trust's delinquency procedures apply to late payment of all contributions. However, before collection actions are taken, a delinquency notice is sent to employers if payment has not reached the Trust within thirty days after contributions are due. In the case of regular monthly contributions, a second notice in the form of an electronic Mailgram is also sent to employers. If contributions are not received in accordance with the delinquency notices, the matter is referred to the Trust’s Collection Attorney, at which point liquidated damages, interest and attorneys fees are assessed.

As you can see, delay in responding to any communication from the Administrative Office involving a delinquency can result in an expensive and time-consuming situation. The Trust's rules are very strict regarding collection of all monies which become due and waivers are rarely granted. Therefore, you are encouraged to contact the Administrative Office in your area for clarification of any delinquency notice or to resolve any shortage or overage appearing on the monthly reporting form. The Administrative Office will work with you to resolve this issue in an expeditious manner.

There are two primary types of situations where the Trust is not able to retain contributions paid in good faith by an Employer. The first situation is a mistake of fact, such as a clerical error, which will result in a credit to the employer. The second situation is a mistake of law, such as an improper contribution on an individual not properly covered by a labor agreement. In the latter situation, the contributions are refunded to the individual(s) on whose behalf they were paid. Federal law requires that in either situation the credit or refund be made within six months of discovery.

Your review of this information is appreciated. Any questions or comments may be directed to the Pension Accounting Supervisor of your Administrative Office.