Legal Question in Employment Law in Alabama
Simple IRA Employer Contributions
My husband was recently let go from his company. We noticed on his last statement for his IRA that the employer did not make his weekly IRA contribution (nor the employers match) deposit into his account until Jan 8 of this year for the entire year of 2006. My husband went to close his IRA (he told his employer he was doing so) and discovered that no deposits have been made this year, even though they take $50 a week from his pay. Is this legal??
1 Answer from Attorneys
Re: Simple IRA Employer Contributions
No. It is blatantly illegal. It is actually a criminal offense. But here's the question: have they caught up with the payments? You said that they made the payments in Jan for 2006. But do they still owe money to the plan and if not, did you not have any gains to the investment during 2006 that you would have gotten. You could sue for any losses that resulted in their failure to fund the plan as they are supposed to remit funds within 30 days according to ERISA. The individuals who are responsible in addition to the company can be sued for such damages. I am presently investigating two companies in your area for this. Is your husband the only employee for whom this happened? Does this company have in excess of 20 employees (preferably over 100)?
Send me a note at [email protected]
I'm awfully curious if this is the other companies that we've been looking at for similar behavior or if this is another company.
Sterling L. DeRamus
Attorney at Law
2015 First Ave. North
Birmingham, AL 35203
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