Labor moves to paperless pension filing

An all-electronic system for filing pension and benefit plans will save the Labor Department 30 percent annually in operating and maintenance costs, according to a solutions developer.

Vangent Inc., an information management contractor, on Wednesday announced that its Employee Retirement Income Security Act Filing Acceptance System, known as EFAST2, has increased Labor's efficiency in managing the Form 5500 annual reports employers must file detailing benefit plans. The paperless system, which went live on Dec. 30, 2009, reduces processing time from 244 days to one.

"To satisfy one of the department's primary goals of improved data quality, the basic concept of EFAST2 is getting data into the government's hands in digital form at the outset," said John Alfano, vice president of civilian operations at Vangent. "It's about converting from a paper-based system where there are inherent flaws and inefficiencies and converting to electronic data."

The new processing system is a Web-based application that works across platforms and requires just an Internet connection to use. Employers can register on the EFAST Web site. According to Labor, third-party preparers cannot file on behalf of clients, so small business owners without e-mail accounts or Internet connections must begin using these technologies. After Oct. 15, all filings must be submitted electronically.

The contract also provides for a support center to assist employers with the filing process.

Another primary goal of EFAST2 was to reduce operating cost, Alfano said, adding that such savings are an expectation of modernizing from a paper-based environment to an electronic one. The paperless system also allows for better collaboration with the Internal Revenue Service and the Pension Benefit Guaranty Corporation, which, along with Labor's Employee Benefits Security Administration, process 1.1 million ERISA filings annually.

Vangent's $150 million contract for the initial EFAST system, which scanned and processed paper forms, is up this year. The new $94 million contract, awarded in April 2008, extends to 2020.