Administrative Expenses

[austin3515]

Can a sponsor sponsoring a 401(k) plan stop paying administrative expenses, and instead charge them to participants on a monthly/quarterly basis without notifying participants of the change?

Assume the document allows payment of expenses, and that the expenses are reasonable (flat charge per month per head).

[R. Butler]

The new SPD rules require that you give some form of notice in the SPD (or I guess SMM, if you aren't restating the SPD).

[Brian Gallagher]

Also, I would think that the participants would only pay the expenses that accrue going forward (after the effective date of the amendment). A company couldn't wrack up $10,000 in expenses over the past three years and then pass that on to the partiicpants. Could they?

[austin3515]

Can it be a vague reference? Like "fees may be deducted?" or "if fees are deducted it will be based on account balance size?"

[david rigby]

In the post-Enron days, why would a plan sponsor want to go down that road of ambiguity, and open the door to later charges of intentionally trying to hide something?