If two 401k plans are mergering, under ERISA is there a specific timeframe during which the plan sponsor must send out a communication piece to plan participants?

[Guest SJaramil]

If two 401k plans are mergering, under ERISA is there a specific timeframe during which the plan sponsor must send out a communication piece to plan participants? Which plan sponsor is responsible for sending out the notice - the existing plan sponsor or the plan sponsor of the new plan into which the plan is merging?

[Guest Pensions in Paradise]

If there will not be a blackout, then surprisingly there is no requirement to even notify participants of the merger. If there will be a blackout, then generally the participants must receive notice at least 30 days prior to the start of the blackout. The existing plan sponsor would be responsible for issuing the notice.

[MWeddell]

Also consider these points:

- An SPD must have the name of the plan and the plan number. Hence, if the name of the plan changes due to a plan merger, a new SPD or an SMM must be distributed within 210 days after the end of the plan year in which the change is made.

- If there are different provisions in the new 401(k) plan that may affect participants, then some courts may find that ERISA imposes a duty on fiduciaries to disclose the provisions. Otherwise, participants who take detrimental action in reliance on the old provisions may be able to sue for damages. See Panaras v Liquid Carbonic Indus. Corp. (1996, CA7).