SPD Amendment For Window?

[ERISA-Bubs]

We amended our plan to include a provision that is only applicable for a limited time. We sent an SMM to our employees to notify them of the change. Do we need to amend the SPD to cover the provision, even though the limited time will have expired by the the time the new SPD is issued and future eligible employees are not affected by the provision?

[John Feldt ERPA CPC QPA]

Was the time period disclosed with the SMM?

Perhaps a little more information might help, too. Does the amendment have any possible permanent affects such as a right or feature that could continue to apply to balances that were in effect at the time the amendment occurred?

[ERISA-Bubs]

It was a lump sum payment window, so no right remains once the window was closed. The window was disclosed in an SMM and the SMM was given to everyone affected by the window. The SMM is not given to new employees who are not eligible for the window. We don't think it makes sense to include in the SPD since byt the time the SPD is issued, the window will have ended. But I can't find anything in the regulations that excludes temporary provisions from being included in the SPD. Anyone know of any guidance?

[John Feldt ERPA CPC QPA]

A lump sum window in a 401(k) plan?

ERISA Section 104 governs the SPD and the regulations under 2520.102-3:

Here are a couple of excerpts from the regulations:

The summary plan description shall be written in a manner calculated to be understood by the average plan participant and shall be sufficiently comprehensive to apprise the plan's participants and beneficiaries of their rights and obligations under the plan.

In fulfilling these requirements, the plan administrator shall exercise considered judgment and discretion

by taking into account such factors as the level of comprehension and education of typical participants in the plan and the complexity of the terms of the plan. Consideration of these factors will usually require the limitation or elimination of technical jargon and of long, complex sentences, the use of clarifying examples and illustrations, the use of clear cross-references and a table of contents.

The format of the summary plan description must not have the effect of misleading, misinforming or failing to inform participants and beneficiaries. Any description of exceptions, limitations, reductions, and other restrictions of plan benefits shall not be minimized, rendered obscure, or otherwise made to appear unimportant. Such exceptions, limitations, reductions, or restrictions of plan benefits shall be described or summarized in a manner not less prominent than the style, captions, printing type, and prominence used to describe or summarize plan benefits. The advantages and disadvantages of the plan shall be presented without either exaggerating the benefits or minimizing the limitations. The description or summary of restrictive plan provisions need not be disclosed in the summary plan description in close conjunction with the description or summary of benefits, provided that adjacent to the benefit description the page on which the restrictions are described is noted.

If the participants have been fully informed and an old provision now no longer has meaning or relevance, I see no requirement that the SPD itself must have its language memorialized in its text. For example, do current SPDs still include language that the age requirement to enter the plan was 25 before the TEFRA/DEFRA/REA restatement was done? Probably not.