"The sufficiency of fiduciary discussions of SSA awards in adverse benefit determinations will continue to be challenged in litigation, particularly with the DOL's 2018 [claims procedures regs]. While Addington's applicability to this (relatively) new regulation is yet to be tested, the decision clarifies that, with respect to claims filed prior to April 2018, a fiduciary's statement that its review 'included vocational and medical assessments that were not considered by the SSA' constitutes a sufficiently detailed explanation for which a fiduciary should not be penalized or prejudiced when litigating in the Third Circuit." [Addington v. Senior Vice President Human Resources Consol Energy, Inc., No. 19-2959 (3d Cir. Dec. 30, 2020)]

"EEOC regulations proposed in the final days of the Trump Administration would, if finalized, reduce the permissible incentive for participatory wellness programs to a de minimis amount -- such as a water bottle or T-shirt.... The Biden Administration has withdrawn the proposed regulations from publication in the Federal Register ... Although they may not be finalized in their current form, the proposed regulations reflect the thinking of the EEOC on how small an incentive must remain (answer: very small) in order to preserve the voluntariness of a participatory wellness program. As such, employers cannot afford to ignore them."

"A recent decision out of the U.S. District Court for the Northern District of Georgia  ... reminds us that defending ERISA breach of fiduciary duty claims based on a plaintiff's failure to exhaust a plan's administrative remedies is a viable option in some federal court jurisdictions." [Fleming v. Rollins, Inc., No. 19-5732 (N.D. Ga. Nov. 23, 2020)]

"President Biden signaled that his administration will review the Final Rule on Investment Duties ... [T]he DOL [Final Rule] eliminated all overt references to consideration of ESG factors.... The Investment Duties regulation left standing instead changes how all fiduciaries are to approach all investment decision-making in connection with all types of employee benefit plans. Under the new rule, fiduciaries are instructed to make investment decisions by considering only 'pecuniary' factors, as defined by the DOL, to the exclusion of 'non-pecuniary' factors, with limited exceptions. The new standard adopts the idea that loyalty to plan interests requires the exclusion of any other interest, including collateral benefits or goals of an investment, which could include ESG factors."

"The final regulations did not make substantial changes to the proposed regulations, which themselves were similar to the initial guidance on new section 162(m) contained in Notice 2018-68. However, there were some clarifications that will affect some taxpayers; a number of these are shown in [a chart]."

"Although FAB 2020-1 provides relief for plan fiduciaries and QTAs to use the PBGC Missing Participant Program, it does not preclude the DOL from pursuing violations of ERISA for a plan fiduciary's failure to [1] maintain adequate plan and employer records and [2] diligently search for participants prior to a transfer of accounts to the PBGC.... [P]lan fiduciaries should establish procedures described in the DOL's Best Practices guidance and use the PBGC's Missing Participant Program for participants and beneficiaries that cannot be located only after the fiduciaries have completed diligent participant searches."

"[T]he only feasible alternative for disposing of the accounts of missing participants in a terminating 401(k) or other defined contribution retirement plan qualified only in Puerto Rico is, after making reasonable efforts to locate the missing participants, depositing with the proper state unclaimed property fund(s) the retirement money of those participants who cannot be located. Sending the money to the [PBGC], completing direct rollovers into individual retirement accounts or annuities (IRA), and opening bank accounts for the missing participants generally are not viable options."

"[T]he EEOC proposal would permit employers to offer only a de minimis incentive in exchange for employee's or family members' participation in a wellness program that contains inquiries about their manifestation of diseases or disorders, and similarly offers the examples of a water bottle or a gift card of modest value as clearly de minimis. However, unlike the ADA rules, there is no exception from the de minimis rule for health contingent wellness programs."

"Most changes are effective for the first plan year beginning on or after January 1, 2022, requiring group health plan sponsors to consider these changes in plan design and the vendor selection process that will start in the next few months for 2022 calendar year plans. In addition, decision-makers on health plan vendor contracts will be required to review new required disclosures from such vendors which are intended to shine a new light on compensation arrangements for various service providers to group health plans. Disclosures must include both direct and indirect compensation to service providers."

"The tax savings opportunities for S corporation ESOPs are substantial, providing fertile ground for creative tax structuring and strategies.... [In 2001,] Internal Revenue Code Section 409(p) was added to limit the tax benefits of ESOPs maintained by S corporations to those in which the ESOP is designed to provide a meaningful benefit to a broad base of rank-and-file employees. Section 409(p) is essentially an ownership concentration test designed to assure broad-based employee ownership within the ESOP."

"Public pensions had a stellar final quarter of 2020, with the funded status of the Milliman 100 plans increasing from 72.6% at the end of September to 78.6% as of December 31. This funded ratio is the highest recorded in the history of Milliman's Public Pension Funding Study and marks quite a swing from Q1 2020, at the onset of the COVID-19 pandemic, when the funded ratio hit a low of 66.0%."

"The year-over-year inflation increase for 2021 is 1.182%.... [A] chart shows the 2021 and 2020 maximum (and in some cases, minimum) penalties for certain health and welfare plan violations assessed after Jan. 15."

"[An] eligible employee who tells you that the doctor's visit was via videoconference should be granted FMLA leave ... But, keep in mind that telephone calls without video, letters, emails, and text messages alone are not considered treatment under the FMLA."

"[T]he court emphasized that the plain language of the Encryption Rule only requires that a covered entity have a 'mechanism' for encryption in place; a covered entity's failure to encrypt three devices did not mean that it 'never implemented 'a mechanism' to encrypt anything at all.' ... The court held that HHS could not prove that M.D. Anderson 'disclosed' ePHI 'without proving that someone 'outside' the entity received it,' a standard that the agency conceded could not be met in that case, and that would be difficult to meet generally." [Univ. of Texas M.D. Anderson Cancer Center v. HHS, No. 19-60226 (5th Cir. Jan. 14, 2021)]

"House Ways & Means Committee Chairman Richard Neal (D-MA) on Jan. 21 introduced the Emergency Pension Plan Relief Act of 2021 (EPPRA), which is an updated version of the Butch Lewis Act ... One of the key provisions is the creation of a special partition program that would expand PBGC's existing authority to partition certain troubled multiemployer pension plans, increase the number of eligible plans and simplify the application process."

"The lawsuit alleges that plan fiduciaries selected unproven TDFs for the plan, failed to monitor them and failed to replace them when they underperformed." [Ford v. Takeda Pharmaceuticals U.S.A., Inc., No. 21-10090 (D. Mass. complaint filed Jan. 19, 2021)]

"The preamble notes that this portion of the regulations is intended to help overcome insurers' confusion about whether they must accept payments from an ICHRA or QSEHRA, which commenters stated has been an obstacle to the implementation of these payment options."

"The average end-of-year balance ($2,672) was higher than the average beginning-of-year balance ($2,187). The average balance increase was even larger when analyzing only accounts that had received either an employee or employer contribution in 2019 ($2,232, increasing to $3,055).... Accounts that received an employer contribution had higher total contributions ($2,846 vs. $2,455) and more frequently contained investments other than cash (9 percent vs. 7 percent).... 63 percent of HSAs experienced a distribution in 2019."

"[T]he plaintiffs argue that the 2018 guidance and waiver approval are contrary to Section 1332, exceed the scope of the agencies' authority (by allowing states to waive non-waivable provisions of the ACA), and are arbitrary and capricious.... Georgia's waiver agreement includes some unique terms and conditions relative to waivers in other states. Those terms seem designed to limit the federal government's ability to suspend or terminate Georgia's waiver. But the federal government can do so as long as it complies with relevant procedures." [Planned Parenthood Southeast, Inc. v. Azar, No. 21-117 (D.D.C. complaint filed Jan. 14, 2021)]

"In a Jan. 20 memo, White House Chief of Staff Ron Klain instructed the heads of executive departments and agencies to place a hold on all recently issued rules and regulations.... With respect to rules that have been sent to the Office of the Federal Register but not published, the memo advises agency heads to immediately withdraw them pending review and approval. And with respect to rules that have been published in the Federal Register or that have been issued in any manner, but have not taken effect, Klain advises that department heads should consider postponing the rules' effective dates for 60 days."

"The company is a safe harbor 401(k) match plan and they pay the match in a lump sum after the plan year. The company amended the plan to remove the safe harbor matching contribution mid-year. What definition of compensation should the plan use to determine the amount of match to make -- full year or partial year?"

68 pages. "ERISA 403(b) plan assets account for more than half of estimated total 403(b) plan assets. This report analyzes 403(b) plans covered by ERISA that also filed Form 5500 Schedule H ... About half of ERISA 403(b) plan participants are in hospital plans, which held 37 percent of ERISA 403(b) plan assets in plan year 2017. Another 23 percent of ERISA 403(b) plan participants were in educational services, holding nearly half (46 percent) of ERISA 403(b) plan assets.... Among large ERISA 403(b) plans with employer contributions in 2017, 26 percent had automatic employer contributions, 58 percent had simple matches, and 8 percent had both of these features.... Overall, 54 percent of large ERISA 403(b) plans had participant loans outstanding, and about three-quarters of participants were in those plans in 2017."

"February 5, 2021 is the deadline for Michigan public school districts to submit a Form 2848 to the State of Michigan Office of Retirement Services to participate in and be covered by the proposed IRS closing agreement related to 3% retiree healthcare contributions. Michigan public school employees who did not opt out of retiree health coverage under the Michigan Public School Employees Retirement System Act are required to make 3% contributions to ORS for retiree health coverage.... For a limited time, the IRS is allowing Michigan public school districts to participate in a closing agreement that favorably resolves the tax treatment of these contributions. The IRS indicated that the closing agreement will provide that the retiree healthcare contributions are exempt from federal income and FICA taxes."

"The U.S. Court of Appeals for the Ninth Circuit recently became the seventh federal appellate court to hold that the standard for 'willful' violations under the Family and Medical Leave Act is whether the employer knows or shows reckless disregard for whether its conduct violates the FMLA." [Olson v. United States, No. 19-35389 (9th Cir. Nov. 23, 2020)]

"Although this case is still working its way through proceedings, this strongly worded opinion calls into question some fundamental principles of OCR's enforcement approach. For example, OCR has consistently asserted that an unauthorized disclosure occurs whenever PHI is publicly accessible through an internet search--regardless of whether it can demonstrate that anyone actually accessed the PHI in that way. It will be harder for OCR to establish privacy rule violations if it has to prove that an unauthorized recipient actually accessed PHI." [Univ. of Texas M.D. Anderson Cancer Ctr. v. HHS, No. 19-60226 (5th Cir. Jan. 14, 2021)]