Six Considerations for Plan Fiduciaries During the Covid-19 Pandemic
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Click Here for Our Resource Page on Retirement Plans and the Coronavirus PandemicIn This Issue
Fiduciary and Plan Governance Six Considerations for Plan Fiduciaries During the Covid-19 Pandemic ERISA fiduciaries may want to identify steps they should be taking and decisions they should be considering to adjust their process in the face of the coronavirus pandemic. This article identifies six such points that could be appropriate for consideration by retirement plan fiduciaries, such as fiduciary committees, as the pandemic and related economic fallout continue to evolve. Source: Morganlewis.com What's the Difference Between a File Clerk and a Fiduciary? The author writes, "What's the difference between a file clerk and a fiduciary? Come June 30th, not much. A clerk is employed to perform menial office tasks. They're told what to do, have little or no discretion, and are not entrusted with critical decision-making. That may describe you in less than 45 days. The SEC's Reg BI is going to cause more harm than good. To illustrate, let's examine the concept of 'fiduciary' in 3D." Source: 401kspecialistmag.com What's Driving the Fee Discussion Within the DC Market Fee compression is also being driven by forces outside the market, specifically the rash of fee litigation and settlements that have forced plan sponsors and fiduciaries to consider lower-cost investment options. Complicating the question of asset management fees is the increasing pressure on recordkeepers to drive down administrative costs to plans, or potentially drive more suits. Source: Schroders.com Groom and Chubb Explore Surge in Litigation Against Fiduciaries of Retirement Plans Groom Law Group, together with Chubb, explores the surge in litigation against fiduciaries of employer-sponsored retirement plans, regardless of size. In the whitepaper, "The War on Retirement Fees: Is Anyone Safe?" Groom principal, Lars Golumbic, and Chubb Senior Vice President, North America Financial Lines, Alison Martin, examine the recent history and trends relating to excessive fee claims. The paper also discusses the plan features that may make it a target of litigation, and the steps fiduciaries can take to potentially reduce exposure to excessive fee lawsuits. Source: Groom.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers The War on Retirement Plan Fees: Is Anyone Safe? Almost every employer that sponsors a retirement plan should be concerned about potential liability for a type of exposure known as excessive fee claims. Historically filed against only the largest organizations, an increasing number of smaller retirement plans have faced excessive fee litigation over the past couple of years. With this surge in litigation, it's important that all fiduciaries, regardless of plan size, understand the history and recent trends relating to excessive fee claims, the plan features that may make it a target of litigation, and steps fiduciaries can take that may reduce exposure to excessive fee claims. Source: Chubb.com
»» Click here for More Studies, Research, and White Papers Plan Communications DOL Finalizes Electronic Participant Communications Safe Harbor for Retirement Plans The final regulation establishes a new, voluntary safe harbor for retirement plan administrators who want to use electronic media, as a default, to furnish covered documents to participants and beneficiaries, rather than providing paper documents through mail or hand delivery. The new safe harbor should be welcome news to virtually all employers who sponsor ERISA-covered retirement plans. Source: Spencerfane.com DOL Finalizes Rule Updating Electronic Disclosure Safe Harbor for Retirement Plans The DOL has issued final regulations providing a new "notice and access" safe harbor for retirement plans to furnish required disclosures by email or other electronic means to participants and beneficiaries. The NOA Safe Harbor should reduce costs for many retirement plans because it expands the availability of electronic disclosures beyond what was permitted under the DOL's prior safe harbor. The final rule includes some modifications to the proposed rule that was issued in October. Source: Kilpatricktownsend.com »» Click here for more on Plan Education and Communications Court and Legal ManTech ERISA Challenge Shows Cases Moving Down Market The plaintiffs have filed a new class-action ERISA complaint against the ManTech International Corp., alleging several fiduciary breaches in the operation of the firm's defined contribution retirement plan. The plan in question has about $800 million in assets, meaning it is quite a bit smaller than many other employers that have faced fiduciary breach lawsuits. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC House-Passed Stimulus Bill Includes RMD Relief, PPP Clarity Included among the retirement-based provisions are additional relief from required minimum distributions, clarifications to the retirement provisions enacted under the CARES Act, funding relief for single-employer pension plans, relief for troubled multiemployer pension plans and an assortment of other changes. Source: Asppa.org »» Click here for more on Legislative and Washington Actions Compliance and Regulatory How Layoffs Will Impact Your Upcoming 401k Plan Audit Due to the current coronavirus pandemic, the financial challenges many companies are experiencing are forcing them to lay off employees. If you're a business that serves as a 401k plan sponsor and has had to lay off employees during the pandemic, you must understand how these layoffs will affect your 401k plan audit. Highlighted here is information on what you can expect from your auditor during the next 401k plan audit, as well as what you can do to prepare for it. Source: Forusall.com Safe-Harbor Leveraging for Small Business, Top-Heavy Retirement Plans - 2020 Many employers are debating how to most efficiently take advantage of the defined contribution limit increase to $57,000. However, few owners of small businesses are aware of the extent to which certain types of "leveraging" are now permitted in qualified retirement plans. The purpose of this article is to illustrate the provisions that allow owners of small businesses to get the most in return for what they are willing to contribute on behalf of their non-owner employees. Source: Consultrms.com The Time Is Now to Optimize DC Plan Loan Policies With the passage of the CARES Act, defined contribution plan sponsors face important decisions concerning their plan design, specifically whether or not to adopt the special distribution and loan limit increases for those affected by the coronavirus. It is a good time for plan sponsors to consider additional design changes that could help preserve long-term retirement security, especially ones that address participant challenges related to job loss, given the unprecedented economic fallout from the COVID-19 pandemic. Source: Plansponsor.com DOL Finalizes Electronic Disclosure Rule for Retirement Plans The DOL announced the publication of a final rule that permits default electronic delivery of retirement plan disclosures. The rule allows employers to deliver disclosures to plan participants primarily electronically, which will reduce printing, mailing, and related plan costs by an estimated $3.2 billion over the next decade, the DOL said in a statement announcing the final rule. The rule will also make disclosures more readily accessible and useful for participants while preserving the rights of those who prefer paper disclosures. Source: 401kspecialistmag.com In response to the COVID-19 pandemic, the Employee Benefits Security Administration issued Disaster Relief Notice 2020-01. The Notice addresses the following issues as impacted by the Pandemic: (i) deadlines for providing participant disclosures and notices; (ii) procedures for plan fiduciaries to authorize loans and distributions, and the timing for adopting amendments under the CARES Act; (iii) delays in making deposits of participant contributions and loan repayments; (iv) failures to provide advance notice of a blackout period; (v) extension of certain Form 5500 filing deadlines, and; (6) relaxed enforcement of compliance with ERISA’s fiduciary standards. This article focuses on the impact of the Notice on retirement plans and the relief it provides to plan fiduciaries and their advisers. Source: Truckerhuss.com Tips for When the QDRO Process Is Held Up Retirement plan sponsors and providers have processes in place for qualified domestic relations orders that may be held upright now because the coronavirus pandemic has caused court closures. Plan sponsors may want to consider modifications to qualified domestic relations order processes. Source: Plansponsor.com The SECURE Act: Lifetime Income Provisions The SECURE Act was signed into law in December 2019 and contains provisions that seek to expand access to lifetime income within retirement plans. The Act seeks to educate individuals on the projected income they could receive from their retirement savings. It also has provisions that should encourage plan sponsors to offer in-plan annuity options by providing a safe harbor for the selection of an annuity provider, as well as expanded portability of the annuity contracts. Source: Multnomahgroup.com »» Click here for more Compliance and Regulatory Material Marketplace News Securian Financial introduces Target Pro™ Portfolios Ascensus to Offer App to Help Participants With Savings Decisions Newport Acquires Huntington National Bank's Retirement Recordkeeping/Admin Business
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