DOL Releases Proposed Rule

On August 20, 2020, the U.S. Department of Labor issued a notice of proposed rulemaking on pooled plan provider registration requirements. The proposal was published on September 1, 2020 and seeks to implement the registration requirements for “pooled plan providers” pursuant to the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019. Public comments were accepted until October 1, 2020.

DOL Releases Interim Final Rule

On August 18, 2020, the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA)  issued an interim final rule that will help workers determine their ability to retire by allowing them to estimate how their current savings in a 401(k)-type plan might translate into lifetime monthly payments. The rule implements section 203 of the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

DOL Releases Proposed Rule

On June 23, 2020, the U.S. Department of Labor’s Employee Benefits Security Administration issued a proposed rule that proposes amendments to the Employee Retirement Income Security Act requiring plan fiduciaries to select investments and investment courses of action based solely on financial considerations relevant to the risk-adjusted economic value of a particular investment or investment course of action. Public comments on the proposed rule were accepted until July 30, 2020.

DOL Releases Request for Information

On June 18, 2020, Employee Benefits Security Administration released a Request for Information (RFI) in response to the SECURE Act’s amendment of ERISA allowing for pooled employer plans. It requests information on the possible parties, business models, and conflicts of interest that respondents anticipate will be involved in the formation and ongoing operation of PEPs, in addition to information regarding similar issues involving multiple employer plans sponsored by employer groups or associations or professional employer organizations. The Department of Labor (the Department) is considering whether to propose a class exemption on its own motion to cover prohibited transactions involving PEPs and MEPs. Comments on the RFI were received until July 20, 2020.

DOL Information Letter

On June 3, 2020, the U.S. Department of Labor (DOL) issued an information letter intended to provide clarity about how ERISA fiduciary duties apply to including alternative investments as they do to more-typical investments in defined contribution (DC) plans. The guidance is an effort to make it clear that ERISA does not prohibit alternative investment in DC plans, and therefore a fiduciary could, if it follows a prudent process, decide to allocate a portion of a target date fund (TDF) portfolio to alternative investments. See DOL’s related press release.

MEP Proposed Rulemaking

Department of Labor

On July 31, 2019, the Employee Benefits Security Administration, Department of Labor (DOL), issued a Request for Information regarding the definition of “employer” in section 3(5) of the Employee Retirement Income Security Act of 1974, as amended. According to the DOL, the RFI is in response to public comments submitted for the proposed rule in October 2018 (see next bullet for details) and could serve as the basis for future rulemaking. The RFI was open for comments for 90 days and closed on October 29, 2019.  All public comments submitted to the RFI can be viewed here.

In addition, on July 31, 2019, the Employee Benefits Security Administration, Department of Labor, published final rules of Definition of ‘Employer’ Under Section 3(5) of ERISA-Association Retirement Plans and Other Multiple-Employer Plans. The regulation addresses when a group or association of employers or PEO falls within the definition of “employer” under ERISA section 3(5) for purposes of sponsoring a MEP under title I of ERISA to cover the employees of member employers.

  • See the Department of Labor’s fact sheet and news release on the final rule.
  • The proposed rules were issued on October 23, 2018 and were open for public comments until December 24, 2018. On December 21, 2018, CRI submitted comments to the U.S. Department of Labor regarding this proposed rule. Click here to view the letter. All public comments can be viewed here. 

Additional Resources:

The District Court of Washington, D.C. ruled that portions of the U.S. Department of Labor’s rule relating to the definition of employer related to Associated Health Plan undercut the Affordable Care Act. Because the definition of employer for MEPs under ERISA is similar to that of employer for Associated Health Plans, there is concern that a court may similarly block U.S. Department of Labor’s s new MEP rule.

The U.S. Department of Labor proposed rules that clarify which organizations can sponsor MEPs as defined by ERISA section 3(5). The impact on state-run MEPs is unclear, as the proposed rules do not explicitly mention them.

Treasury Department

On July 3, 2019, the Internal Revenue Service, Department of the Treasury, issued a notice of proposed rulemaking related to the tax qualifications of multiple employer plans. Proposed regulations would provide an exception to the “unified plan rule” if one employer fails to satisfy a qualification requirement or fail to provide information used to determine compliance with such requirements. The comment period closed on October 1, 2019.

Additional Resources:

ERISA Basics

View Recent DOL ERISA Advisory Council Reports:

CRI Policy Reports

  • Multiple Employer Plans: An Overview of Legal, Regulatory and Plan Design Considerations for States. Click here to learn more about how ERISA and other laws apply to MEPs.
  • Review of Potential Public Retirement Plan Options for Private Sector Employees/Employers in the State of Vermont. Click here to learn more about how ERISA and other laws apply to retirement plan design options.
  • State Initiatives to Expand the Availability and Effectiveness of Private Sector Retirement Plans: How Federal Laws Apply to Plan Design Options. Click here to learn more.