disclosure in enrollment materials

[Guest cbclark]

Hello all. We have been working diligently on all the engagement letter/disclosure materials for plan sponsors per ERISA 408(b)(2), and the new levels of detail in participant statements. A question came up today that stopped me in my tracks: should the fee/return information (that will be disclosed on participant statements) be included in the investment information on enrollment materials? We generate forms for the plan sponsor that include all the funds available for investment election. My common sense self says that a new enrollee probably would appreciate the fees/return information; my eyerolling "how to explain this to the sponsor and/or employee" self says it is not needed. Any thoughts out there? All I know for sure is that if the disclosures and benchmarks and so on are required on enrollment forms, each form will be many many pages long....Thanks.

[Jim Chad]

FWIW I think it is required. but if it is part of the "enrollment kit", does that mean the whole kit becomes obsolete every quarter?

What do you all think?

[Guest cbclark]

Thanks Jim. You ask a great question....stale information would in my estimation be worse than no information. The DOL did a webcast a while back, maybe they will compile a FAQs that includes this information, or what they are thinking about the information.

[Jim Chad]

Maybe it would be better to leave it out of the "kit" and whenever a kit is given out, paperclip the last disclosure to it.

[Guest cbclark]

There is that....educating the HR folks at the plan sponsors and creating the new page internally is just one more layer of crazy, sometimes. My apologies, it is Monday with a vengeance!

[Guest benji]

The quarterly requirements on the statements: Are just the statement of actual charges or deductions, albeit administrative and/or individual fees that have been deducted from a participants account.

The Investment Fee and Investment Return information, is required "initially", at point of eligibility, and annually for the eligible non-participant, and the participant.

There is nothing in the regulation that says it cant be part of the enrollment kit, which would satisfy the initial requirements for the newly eligible.

Newkirk has added this feature to their solution set. 1-855-NEWKIRK.

[Guest ebgroup]

If it helps, the preamble of the regulations for the participant fee disclosure do allow you to meet the new eligible disclosure requirement by giving the participant a copy of the last annual notice. So basically, you would update what is in your enrollment kit once a year. You do have to add any change notices to it, if a change notice is required to be sent to all eligibles and participants under the regulation, but I do not think you need to otherwise update the information.

When everything is said and done, I think this starts looking very similar to your SPD and SMM process.