Legislative and Washington DC

The Beltway Is Buzzing With Retirement Proposals

The word of the moment in Washington, D.C. when it comes to retirement activity is busy. Legislative and regulatory proposals are floating through the halls of Congress and in the offices of agencies such as the Department of Labor, said Preston Rutledge, who served as assistant secretary of labor for the Employee Benefits Security Administration under President Donald Trump.

Source: Insurancenewsnet.com

Senate Committee Hearing Explores Retirement Security Measures

The Senate Health, Education, Labor, and Pensions (HELP) Committee will hold a hearing this week to examine issues surrounding retirement security and measures Congress may consider to help more of America's workers and retirees save and plan for their golden years.

Source: Myirionline.org

Summary of Provisions in the Securing a Strong Retirement Act of 2021

This chart summarizes the "Securing a Strong Retirement Act of 2021" as marked up by the House Ways and Means Committee on May 5, 2021.

Source: Groom.com

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Insight: Studies, Research, and White Papers

Record Balances: DC Plan System Continues to Thrive

Fresh data shared this week by Principal and Fidelity shows defined contribution retirement plan balances have -- yet again -- reached record highs, but the data also underscores the need to improve access for more workers.

Source: Planadviser.com

ESG Options in 401k Plans Could Lead to Higher Contribution Rates According to Survey

According to the Schroders 2021 Retirement Survey, 37% of DC plan participants said they are offered ESG-related investment options by their employer, while 40% said they did not know. Of those who were aware of their ESG options, 9 out of 10 said they invest in them. Further, of those who said their DC plan did not offer ESG investment options or did not know, 69% said they would or might increase their overall contribution rate if offered ESG options. Only 31% said they would not.

Source: Businesswire.com

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Items of Special Interest to Service Providers

The Long Terms Effect of COVID on 401k Plan Providers

The COVID pandemic is probably the most challenging thing we have gone through in our lifetime. While COVID has certainly been challenging, it has also opened eyes as to where the retirement plan industry is headed and the profound long-term effect that COVID will have on the retirement business (both good and bad).

Source: Jdsupra.com

Court and Legal

Judge Moves Forward Wells Fargo 401k Self-Dealing Suit

A federal district court judge has moved forward a lawsuit alleging that Wells Fargo 401k plan fiduciaries should have been able to obtain superior investment products at a very low cost but instead chose proprietary products for their benefit, increasing fee revenue for the company and providing seed money to newly created Wells Fargo funds.

Source: Planadviser.com

Bronson Healthcare Group Sued Over 403b Plan Fees

Bronson Healthcare Group and its board of directors are facing an ERISA lawsuit alleging they allowed participants of the organization's 403b Tax Sheltered Matching Plan to be subjected to excessive administrative and investment fees, resulting in lower account balances.

Source: Planadviser.com

University Pushes Back on Excessive Fee Class Claims

The fiduciary defendants in a 403b university excessive fee suit say the plaintiffs have not only failed to make their case but that they've taken actions in their account(s) that undermine their arguments. The suit was originally filed in June 2017 by Latasha Davis and Jennifer Elliott on behalf of the plan's more than 24,000 participants and beneficiaries.

Source: Napa-net.org

Humana Faces Classic Prudence Claims in New ERISA Lawsuit

Plaintiffs have filed a proposed class-action lawsuit against health insurance provider Humana in the U.S. District Court for the Western District of Kentucky, alleging breaches of the fiduciary duty of prudence required by ERISA. The plaintiffs allege that, with its billions of dollars in assets, the Humana DC retirement plan has substantial bargaining power regarding the fees and expenses charged against participants' investments.

Source: Planadviser.com

Wells Fargo Fails to Shake 401k Suit

A lawsuit against Wells Fargo over the use of its investment products in the company's $40 billion 401k plan this week cleared a major hurdle. On Wednesday a federal judge denied a motion to dismiss the case, finding that the plaintiffs' "allegations are far more than general assertions, and that accepted as true, show that [the] defendants engaged in prohibited transactions." The development likely gives the plaintiffs more leverage for a settlement, as the class-action case has moved one step closer to a trial.

Source: Investmentnews.com (registration may be required)

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Multiple Employer Plans (MEP)

Pooled Employer Plans: Employer Considerations

This article reviews some of the considerations employers may need to address when trying to decide whether to participate in a particular PEP. There will be many PEPs available in the market from which to choose; thus, employers will need to look to a PPP's and/or a PEP's marketing or other materials for more detailed information. But, there is some essential information employers seek and consider.

Source: Actuary.org

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State-Based Private Sector Retirement Programs

How Employers With 51-100 Employees Can Meet Their CalSavers Deadline

Money penalties apply to employers who don't timely either establish their exempt status or participate in the program. This article is a how-to for employers in the 51+ group, who have approximately six weeks until their CalSavers deadline arrives.

Source: Eforerisa.com

NYC Will Require Mandatory Retirement Savings for All Private Sector Employees

On May 11, 2021, Mayor Bill de Blasio signed into law legislation that will require private-sector employers located in New York City to provide a mandatory retirement savings program for their employees. As a result, New York City employers will soon have to take action to ensure that each eligible New York City employee is properly enrolled in a retirement program.

Source: Foxrothschild.com

Compliance and Regulatory

Recovering Retirement Plan Overpayments: Process Is Key

A qualified retirement plan paying more in distributions than a participant is entitled to occur frequently. While unfortunate for participants who received an overpayment, a plan sponsor must recover overpayments on behalf of the retirement plan to protect the plan's tax-qualified status and comply with the sponsor's fiduciary responsibilities under ERISA. A recent court case involving the recovery of an overpayment highlights the value of having a robust administrative process for dealing with the inevitable overpayment issues that arise.

Source: Dickinson-wright.com

Compliance Connections: Reviewing and Reprioritizing Your Retirement Plans

Recent developments for qualified retirement plans have received significant attention among plan administrators, but some may have flown beneath the radar. When you're an ERISA fiduciary, new developments occur quickly. With information coming to you from many directions, this article highlights some of the significant developments, so you can quickly connect the alignment of your existing retirement plan with the most current information, rules, and guidance.

Source: Ajg.com

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Marketplace News

Pentegra Introduces Fiduciary Scorecard to Measure Plan Success

Putnam Investments Rolls Out TDF Evaluation Tool

TRA Acquires John T. Toomey Associates

This eNewsletter is a digest of information published by a variety of web-based sources on 401k and related issues and is published as a service to our users. 401khelpcenter.com, LLC is not the author of the material unless specifically noted.