The Coronavirus Crisis: What Plan Sponsors Should Do
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Click here for Coverage of the Coronavirus Pandemic and 401k PlansIn This Issue
General Items The Coronavirus Crisis: What Plan Sponsors Should Do The Coronavirus pandemic is disrupting everyone's personal and financial lives. While our health, and that of our families and friends, is paramount, we realize that the sudden and large investment losses in the 401k plans that you sponsor -- and act as fiduciaries for -- present issues more challenging than those typically encountered by employers and plan committees. This article suggests steps that you can take as fiduciaries to address those challenges. The article also applies to advisors because it addresses questions they may get from plan sponsors. Source: Fredreish.com Plan Sponsors Facing Difficult Decisions During Coronavirus Pandemic Employers are facing difficult decisions as a result of the economic impact of the coronavirus outbreak, including decisions about their retirement plans. Stopping employer matching contributions, laying off employees, adjusting DB plan contributions; plan sponsors need to understand the effects of each decision. Source: Plansponsor.com Help Participants Stay on Course in Turbulent Times The recent stock market turbulence associated with the coronavirus has been described as a crash, a "meltdown," and a "disaster." Even investors who are committed to staying the course can find it hard to overcome the uncertainty of what lies ahead. Plan sponsors can help participants to stay the course by reminding them that short-term market fluctuations, even unprecedented ones, should not affect their long-term investment goals. Here are just a few of the steps you can take to provide your plan participants with greater peace of mind that their assets are in good hands. Source: Planpilot.com Fiduciary and Plan Governance The Math Behind Plan Fee Evaluations Plan sponsors have heard -- and many excessive fee lawsuits state --that larger defined contribution plans, in terms of assets, pay lower fees. But do they? Determining whether fees are reasonable for participants requires an additional layer of calculation, and some fee elements and allocations make it more complicated than it should be. Source: Plansponsor.com COVID-19: Impact on U.S. Retirement Plans The COVID-19 pandemic is a once-in-a-generation global emergency. Retirement programs are not immune to the disruption it has caused. At this time it is critical that these programs continue to function and fulfill their important role in society as many will depend on them to provide much needed financial security. This 10-page reference document addresses the potential disruptions to employer-sponsored retirement programs and how plan fiduciaries can mitigate them. Source: Buck.com COVID-19 Checklist for Plan Fiduciaries As COVID-19 upends business operations, it is changing 401k plan management. Plan fiduciaries face new responsibilities and urgent situations. This is a checklist of tasks and issues for consideration, with recommendations of service providers whose assistance employers may seek. Source: Alliant401k.com »» Click here for more Fiduciary and Plan Governance Material 403b Plans IRS Extends Remedial Amendment Periods The IRS has extended the remedial amendment period for 403b plans and pre-approved defined benefit plans. The IRS made the announcement on March 27. Source: Asppa-net.org »» Click here for More 403b Material Court and Legal Minimizing the Risk of ERISA Litigation in a Turbulent Economic Climate Based on past litigation experience, there are some types of investments that are considerably more likely to be the target of claims under ERISA. This article reviews these claims and also offers some thoughts on preventative measures that plan sponsors and fiduciaries can consider. Source: Proskauer.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC Retirement and Pension Provisions in the CARES Act Congress provides a variety of tax incentives for employers to offer retirement plans and for individuals to save for their retirement. Also, several restrictions exist to ensure that retirement funds are used for retirement purposes. The CARES Act contains several provisions that affect pensions, retirement plans, and Individual Retirement Accounts. This 3-page document from the Congressional Research Service reviews them. Source: Congress.gov The CARES Act includes several key provisions that will positively impact retirement plan participants and plan sponsors. The ARA has prepared this FAQ to highlight some of the most salient relief measures. Source: Asppa-net.org Impact of the CARES Act on Retirement Plans and Action Items for Plan Sponsors This special alert addresses the relevant CARES Act provisions affecting retirement plans, which plan sponsors should be aware of immediately, and suggest practical steps that plan sponsors should consider now in light of the passage of the CARES Act. Source: Truckerhuss.com »» Click here for more on Legislative and Washington Actions Compliance and Regulatory 401k Plans in the Age of COVID-19: Hardship Withdrawals, Loans, Contributions, and Other Issues Employee benefit plans, including 401k retirement plans, present unique issues. This article explores hardship distributions, plan loans, contributions, and other issues in association with the present COVID-19 crisis. Source: Compliancedashboard.net Reducing or Suspending Employer Retirement Plan Contributions Due to COVID-19 The COVID-19 pandemic raises many concerns for employers who sponsor qualified retirement plans, particularly employers who experience economic hardship. This article addresses the most common questions asked by employers who want to reduce or suspend retirement plan contributions. Source: Icemiller.com Special Distributions From Puerto Rico Retirement Plans and IRAs are Extended to COVID-19 Victims The PR Treasury Department issued on March 29, 2020, Internal Revenue Circular Letter No. 20-23 providing that "Eligible Expenses" under the recently issued Internal Revenue Circular Letter No. 20-09 will also consist of damages, losses (including loss of income), and extraordinary expenses incurred as a result of the COVID-19 emergency. Source: Mcvpr.com Guidance on Substantial Workforce Cuts and Partial DC Plan Terminations Employers that reduce their workforce or discontinue defined contribution plan eligibility for certain employee groups may experience an inadvertent "partial plan termination." If not properly managed, this event could result in a disqualification of the entire plan. Source: Callan.com COVID-19 Relief: Changing Employer Retirement Plan Contributions As employers face the current state of the economy with COVID-19, some plan sponsors are seeking to reduce or temporarily suspend employer contributions. Here is a brief overview of the options available to employers. Plan sponsors should review their plan documents and discuss the reduction or suspension with their retirement plan service providers and/or ERISA attorneys. Source: Tri-ad.com »» Click here for more Compliance and Regulatory Material
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