Proactive Steps Every 401k Plan Sponsor Should Take
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General Items Proactive Steps Every 401k Plan Sponsor Should Take Abstract: A 401k plan can be used as a weapon against you because of the potential liability exposure from litigation by participants or penalties from the Internal Revenue Service or Department of Labor. This article is how you can be proactive in maintaining your 401k plan. Source: Jdsupra.com Partial Bundling Overtakes Full Bundling for Retirement Plan Services Abstract: Particularly in the small- and mid-sized plan segments, industry analysts tend to agree that the prevalence of partially bundled plans will likely remain prevalent for some time, in part because recordkeepers are facing fee compression. Source: Plansponsor.com Fiduciary and Plan Governance Payroll Is a Fiduciary's Trojan Horse Abstract: Changes in the enforcement focus of the Internal Revenue Service and the U.S. Department of Labor place payroll operations high on the list of fiduciary functions that employers must monitor with great care. The financial penalties and reputational harm caused by payroll failures can be costly and damaging to enterprises that sponsor 401k and 403b retirement plans. Source: Rolandcriss.com Audit Quality and Auditor Selection Abstract: One of the most important duties of the plan administrator is to hire an independent auditor for the plan. A quality audit helps ensure the financial integrity of a plan and protect plan assets. A quality audit also will help a plan administrator carry out its legal responsibility to file a complete and accurate annual return/report for the plan each year. Source: Aicpa.org »» Click here for more Fiduciary and Plan Governance Material Items of Special Interest to Service Providers Updated State Fiduciary and Best Interest Developments Chart Abstract: Drinker Biddle & Reath has updated their state fiduciary/best interest developments chart. They note that they are still waiting for finalization of the Nevada rules on the fiduciary duty for broker-dealers and investment advisors and the effective date of the New York rules on the sale of annuities and life insurance. In the meantime, though, Maryland and Massachusetts have stepped in with new developments. Source: Brokerdealerlawblog.com Inside and Outside Views on Principal's Wells Fargo Acquisition Abstract: Principal's retirement business president offers additional details about the firm's acquisition of Wells Fargo's retirement business, while outside analysts reflect on the broader industry implications of two major providers coming together. Source: Planadviser.com Court and Legal Boeing Faces ERISA Lawsuit Over 737 MAX Issues Abstract: Participants in a Boeing retirement plan have filed an ERISA lawsuit related to the Boeing 737 MAX airplane issues. The complaint says Boeing should have warned defined contribution plan participant invested in the company's stock that issues the company was having caused the stock price to be inflated. Source: Planadviser.com Pay to Play Lawsuits -- Issues for Plan Sponsors Abstract: After briefly reviewing current "pay to play" litigation, the article takes up the question, "do these arrangements pose an ERISA prudence challenge for sponsor fiduciaries?" Bottom line: as with other 401k fee litigation, the key question is likely to be, is the plan overpaying for these services? And the answer to that question is likely to turn on the issue of fair market value and the cost of alternative solutions. Source: Octoberthree.com Are Class-Action Waivers the Future of ERISA Plans? Abstract: Thanks to a recent ruling by the Supreme Court, employers can now be confident that arbitration agreements and class action waivers are enforceable and do not violate the National Labor Relations Act. This debate started in 2011 with AT&T Mobility Servs. v. Concepcion, which held that arbitration provisions were enforceable when included in consumer contracts. It further held that these agreements barred participation in class action litigation. Employers began to adopt similar agreements to protect their plans against significant litigation. Source: Hallbenefitslaw.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC A Step Forward for Retirement Legislation Abstract: There is a significant amount of interest in Congress in retirement security, and lawmakers on both sides of the aisle have been working on a legislative package for a number of years. The SECURE Act's prospects for enactment in this Congress are good as it is the result of a multi-year, bipartisan process and has the support of many key lawmakers. Source: Groom.com Novel Retirement Program Proposed Abstract: Lawmakers in the U.S. Senate and House of Representatives have jointly introduced the "Saving for the Future Act," which is legislation modeled on the United Kingdom's National Employment Savings Trust (NEST) program. Source: Ascensus.com Impact of Executive Order on ESG, Proxy Voting May Be Muted Abstract: The White House issued an executive order on the evolving topic of proxy voting and environmental, social and governance investing programs being put into practice by retirement plans subject to ERISA. One ERISA expert says fiduciaries already evaluating ESG risks and those being active in proxy voting will continue parsing whatever ad hoc disclosures are volunteered by companies. Source: Planadviser.com »» Click here for more on Legislative and Washington Actions Cyber and Plan Security Could This Be Your Retirement Plan? Abstract: B.C. Pension Corporation announced a data breach involving pension plan records after discovering a box containing microfiche could not be found following a recent office move. The box contained personal information (names, social insurance numbers and dates of birth) on approximately 8,000 pension plan participants. The company employed those participants during the period 1982 to 1997. Learning of this incident, persons responsible for pension plan administration might be wondering how secure are their facilities (or their service provider's facilities) for remote storage. And, pension plan participants might be wondering why do plans need this information and for so long. Source: Benefitslawadvisor.com »» Click here for more on Cybersecurity Issues Compliance and Regulatory The DOL's Temporary Enforcement Policy: Potential Traps for the Unwary Abstract: For advisors who are fiduciaries, the loss of the BIC Exemption -- which permitted the receipt of "conflicted compensation" when an advisor satisfied best interest and disclosure requirements -- is problematic. Fortunately, the DOL recognized that problem and provided relief in Field Assistance Bulletin 2018-02. While this relief is significant, it is not without limitations. Source: Brokerdealerlawblog.com DOL's Target for Missing 401k Participants Is Zero Abstract: At the 2019 NAPA 401k Summit, Assistant Secretary of Labor Preston Rutledge indicated the DOL's long-term goal is to help employers so participants don't go missing. Ever. Source: 401kspecialistmag.com »» Click here for more Compliance and Regulatory Material Marketplace News Fidelity Rolls Out New Bundled Solution for Small- and Mid-Sized Businesses Principal to Acquire Wells Fargo Institutional Retirement Business »» Click here for More Marketplace News
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