PSCA Releases 2022 403b Survey
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403b Plans PSCA Releases 2022 403b Survey As employers everywhere continue to recover from the long-term impacts of the COVID-19 pandemic and compete for talent, employer contribution rates to 403b plans rose almost 24% year-over-year from 4.6% in 2020 to 5.7% of gross annual pay in 2021, according to an annual 403b Plan Survey from the Plan Sponsor Council of America, part of the American Retirement Association. Source: Psca.org »» Click here for More 403b Material Fiduciary and Plan Governance Why Plan Sponsors Should Allow Independent Fiduciaries to Manage Employer Stock in Retirement Plans The biggest value to using an independent fiduciary in this context is that it dramatically increases the likelihood that a plan fiduciary, sued for the drop in value of employer stock held by employees in a benefit plan, can end the case at the motion to dismiss stage. Author reviews why this is. Source: Bostonerisalaw.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers Economy Forcing Cutbacks in 401k Contributions: Morgan Stanley Because of the economic impacts related to inflation and/or concerns about a recession, 62% of employees report that they've needed to reduce contributions to their savings, with nearly a third (31%) reducing contributions to their 401k plans. That's a key finding from the latest research released today from Morgan Stanley at Work's second annual State of the Workplace Financial Benefits Study. Source: 401kspecialistmag.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers Four Ways an Independent Recordkeeper Benefits an Advisor Advisors have a primary choice between partnering with companies who sell insurance or investments and offer 401k plans as part of their financial services lineup and independent recordkeepers who tend to be local or regional specialists who focus on actively collaborating with financial and tax advisors to design and operate retirement plans tailored to their clients. This piece reviews four ways an independent recordkeeper can help you grow your retirement plan practice. Source: Abgnational.com The smartphone's advance took life one giant step forward for RIAs, but they can't fight the law of unintended consequences and it may already have won. Smartphones make our business and personal lives porously one. Yet from the SEC's perspective, no such blurred line exists, and every mobile chat with a client pertaining at all to business is subject to compliance. Source: Riabiz.com Court and Legal Home Depot Victorious in ERISA Suit A federal judge for the U.S. District Court for the Northern District of Georgia ruled in Home Depot's favor in an ERISA lawsuit last Friday. Plaintiffs Jaime Pizarro and Craig Smith brought the class action lawsuit in April 2018. They alleged that Home Depot offered imprudent investment options for their retirement plans and failed to monitor their performance in violation of ERISA over a class period beginning in April 2012. Source: Planadviser.com TIAA Prevails in Rollover Recommendation Suit A case involving allegations of a fiduciary breach related to a rollover recommendation provides some interesting perspectives on several operational issues. The variety of claims notwithstanding, Judge Katherine Polk Failla of the U.S. District Court for the Southern District of New York said it was "predicated in large measure on the Court finding that Defendants were not ERISA fiduciaries during the relevant timeframe." Source: Napa-net.org A September 27, 2022, decision by the Southern District of New York addresses several key theories recently advanced by the plaintiffs' bar in ERISA-based lawsuits against plan service providers. The Court also rejected fiduciary liability claims concerning alleged uses of plan information available to the Provider in its plan service provider role. The decision includes a reasoned analysis of the DOL's "shifting perspective" on defining invest. advice fiduciaries under ERISA. Source: Groom.com In Baumeister v. Exelon and Coyer v. Univar Sols. USA Inc., two Illinois district courts became the first courts in the Seventh Circuit to rule on motions to dismiss ERISA fee and investment claims following the Seventh Circuit's ruling in Albert v. Oshkosh, which affirmed the dismissal of similar ERISA claims. In a familiar slate of allegations, plaintiffs in both cases claimed that plan fiduciaries breached their fiduciary duties under ERISA by permitting their respective plans to pay excessive recordkeeping fees. Source: Erisapracticecenter.com Insurer the Target of an ERISA Lawsuit Retirement plan participants have brought a class action lawsuit against Mutual of America Life Insurance Company for an alleged breach of fiduciary duty under ERISA. Plaintiffs have alleged Mutual of America 401k plan fiduciaries breached its fiduciary duties of loyalty and prudence to participants by selecting a proprietary, closed architecture recordkeeping platform and for failing to monitor or control the plan's administrative expenses, the complaint states. Source: Planadviser.com ERISA Lawsuit Against Associated Bank Dismissed A federal judge has dismissed a lawsuit seeking class action certification against fiduciaries of the Associated-Banc Corp. 401k and employee stock ownership plan. Plaintiffs alleged plan fiduciaries engaged in self-dealing and retained proprietary investments that underperformed their benchmarks. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC New Bill Seeks to Encourage 401k Investment in Alternative Assets The Retirement Savings Modernization Act aims to clarify ERISA to incentivize retirement investment in assets such as real estate, private equity, and cryptocurrencies. Source: Planadviser.com House Approves Bill Banning Arbitration Clauses in ERISA Plans Shortly before recessing for the mid-term elections, the House of Representatives approved legislation that would prohibit arbitration and discretionary clauses in employer-sponsored benefit plans under ERISA. The proposed changes were passed as part of the Mental Health Matters Act (H.R. 7780), which the House approved on Sept. 29. Source: Napa-net.org »» Click here for more on Legislative and Washington Actions Cyber and Plan Security Searching for Solutions to Participant Account Theft When the Recordkeeper Disclaims Liability Most of us have heard that a plan participant in the Colgate-Palmolive 401k plan suffered a cyber theft of her entire account balance, and sued the plan fiduciaries, the recordkeeper, and the bank custodian, all three of which are disclaiming fiduciary liability. There has to be a better answer than saying "I'm sorry" to a plan participant who has lost his entire account balance. This article explores these issues after a summary of the case and the positions of each defendant in their respective motions to dismiss. Source: Euclidspecialty.com »» Click here for more on Cybersecurity Issues Compliance and Regulatory Retirement Plan Notice Delivery Requirements Providing your employees and plan participants timely access to retirement plan documents is required by law. In May 2020, the DOL finally agreed the internet is here to stay and, at long last, has made it easier to fulfill that requirement electronically. With the rise in technology and the use of electronic devices, the DOL has learned to appreciate the benefits that come with recognizing electronic delivery as an acceptable medium for communicating these required documents to employees. Regardless of delivery method, Plan administrators must still take measures to reasonably ensure the confidentiality of personal information is protected, the documents are received and reviewed, and the process remains free of charge to the participant. Source: Benefit-Resources.com IRS Notice 2022-53: Certain Required Minimum Distributions for 2021 and 2022 This notice announces that the Internal Revenue Service intends to issue final regulations related to required minimum distributions under section 401(a)(9) of the Internal Revenue Code that will apply no earlier than the 2023 distribution calendar year. In addition, this notice provides guidance related to certain provisions of section 401(a)(9) that apply for 2021 and 2022. Source: Irs.gov Retirement Plan Sponsors Have Short 2022 Year-End Amendment List With IRS recently extending several plan amendment deadlines, retirement plan sponsors now have few (if any) plan amendments to adopt before 2022 draws to a close. Source: Mercer.com »» Click here for more Compliance and Regulatory Material Marketplace News Sallus Retirement, IFP Partner on Pooled Employer Plan Fidelity Readies Annuity Platform for 401k Assets HUB International Acquires Advisory Business of Quintes Major Recordkeepers Form Consortium With RCH Multnomah Group Acquires Pacific Retirement Partners
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