Plan Sponsor Due Diligence in a Demanding Time for Recordkeepers
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Fiduciary and Plan Governance Plan Sponsor Due Diligence in a Demanding Time for Recordkeepers While recordkeepers are under considerable pressure, they are showing compassion for plan sponsors and participants during the coronavirus pandemic. From waiving fees to offering additional financial help, retirement plan recordkeepers, third-party administrators and advisers, as well as financial wellness providers, are stepping up to assist plan sponsors and employees in several ways. Plan sponsors can, in turn, show compassion for their recordkeepers, while at the same time ensuring their plans are operating smoothly. Source: Plansponsor.com Coronavirus Fiduciary Investment Claims: A Look at Retirement Plans The plaintiff bar is seeking recovery on a new and elevated standard of care that has not been articulated by the DOL or fiduciary regulation. Plan sponsors are now subject to expensive litigation and inconsistent standards for retirement plan fees, with results largely based on the proclivities of the judge to whom the case is assigned or in which circuit the case is filed. This is contrary to the stated purpose of ERISA to avoid "litigation expenses" that "unduly discourage employers from offering [such] plans." Source: Euclidspecialty.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers CITs Fit Well With Best Interest Service A new white paper published by Wilmington Trust documents the dramatic ongoing expansion of the U.S. collective investment trust marketplace. Among the attractive but less-often-discussed features of collective investment trusts is the fact that the sponsoring trustee -- a bank or trust company -- must commit to acting in the best interest of unitholders. Source: Planadviser.com »» Click here for More Studies, Research, and White Papers 403b Plans 403b Retirement Plan Fee Litigation Update Despite the COVID-19 pandemic, 403b retirement plan litigation remains largely uninterrupted. While not all claims are successful, to manage risk, plan sponsors should understand the issues and keep track of the litigation surrounding retirement plans. This is a comprehensive update on the status of 403b retirement plan lawsuits. Source: Cammackretirement.com 403b Plans and Optional Retirement Plan Provisions Can a pre-approved 403b plan have an optional retirement plan provision? Would it fall under the mandatory contributions? ORPs can take on different components of a 403b plan. They are not all the same. Source: Ntsa-net.org »» Click here for More 403b Material Plan Communications Working Through DC Plan Communications in a Pandemic In this time of heightened market volatility and economic uncertainty, employees are trying to figure out what to do. They have questions about their retirement savings plan accounts and their finances in general. And because employers are a trusted source of information, their natural inclination is to turn to you for answers. Here are three areas to review as you develop your DC plan communications for the remainder of 2020. Source: Buck.com »» Click here for more on Plan Education and Communications Legislative and Washington DC Catch-up Contributions Being Weighed in Congress A congressman is floating a proposal that would funnel more assets into tax-deferred retirement accounts by tripling the contribution limits for the rest of this year. Source: Investmentnews.com (registration may be required) »» Click here for more on Legislative and Washington Actions Compliance and Regulatory The IRS Extends Retirement Plan Payment and Filing Deadlines In response to the coronavirus pandemic, on April 10, 2020, the Internal Revenue Service issued Notice 2020-23, extending the deadlines for the time-sensitive actions outlined in Revenue Procedure 2018-58 to July 15, 2020. These extensions apply to certain retirement plan payment and filing obligations that have deadlines on or after April 1, 2020, and before July 15, 2020. Source: Truckerhuss.com How to Correct Late Salary Deferral Deposits Late deposits of employee 401k and 403b deferrals continue to be a common error and consistent with the top ten list of mistakes the IRS and DOL identify during their audits and investigations. When employee deferrals are not deposited timely, there are two available correction avenues: self-correction or completing a filing through the DOL's Voluntary Fiduciary Correction Program. This article discusses the rules regarding the timely deposit of salary deferral withholdings, when a timely deposit doesn't occur, and the steps the plan sponsor must take for each of the available correction options. Source: Belfint.com COVID-19 May Affect Nondiscrimination Testing Because of the economic impacts of the COVID-19 pandemic, DC plan sponsors may be making changes that can affect actual deferral percentage and actual contribution percentage test results: laying off or furloughing employees, reducing employees' salaries, reducing or suspending company matches, for example. Also, plan participants may make changes to their deferral rates, which can also affect nondiscrimination testing. Because of these changes, plan sponsors may want to consider sample testing to project outcomes and take steps to avoid failed testing. Source: Plansponsor.com Approving QDROs During Court and Government Office Closures Due to widespread court closures as a result of the coronavirus pandemic, it may be difficult for participants or their attorneys to obtain a certified copy of a domestic relations order that many retirement plans require as part of the procedures for processing qualified domestic relations orders. To address this issue, plans might consider adopting temporary procedures that allow for the continued qualification and processing of QDROs during these extraordinary circumstances without creating permanent exceptions to their normal QDRO procedures. Source: Morganlewis.com The Cares Act: Things to Consider Before Implementation We are witnessing an understandable rush to make decisions that provide relief to employees, plan participants, and employers. But it is important to take a brief pause at this time to review the interplay and flexibility of these relief programs and the possible administrative and communication problems. Source: Smithdowney.com More than one month has passed since the enactment of the CARES Act, yet there are still many widely held misconceptions about the retirement plan-related provisions. This article attempts to dispel some of those myths. Source: Cammackretirement.com Can Plans Rely on Virtual Notarization? In response to the logistical challenges created by the Coronavirus pandemic, some states are taking steps to authorize virtual notarization. Given the unprecedented circumstances and the various notary-based requirements to conduct business transactions in person, these developments could be particularly important for retirement plan administrators. Source: Napa-net.org »» Click here for more Compliance and Regulatory Material
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