News Items

24 pages. "[T]his study analyzes the benefits received by the CEOs and CFOs at 200 public companies  ... [The] findings are intended to provide an overview of the current environment and identify market trends with regard to executive change in control arrangements. Observations and comparisons are made between this study and ... 2015 and 2017 studies, as appropriate."

"OCR is issuing a Notice of Violation to the state of California, formally notifying California that it cannot impose universal abortion coverage mandates on health insurance plans and issuers in violation of federal conscience laws. California has deprived over 28,000 people of plans that did not cover elective abortion, but now must cover abortion due to California’s mandate."

EBSA has released a new search tool for Form 5500 filings. In addition to searching for specific filings, users now can search for filings using new filters including plan type, plan asset value, number of participants, employer plan types, business codes, form years, and locations. The number of search results generated increased to 5,000 filings. Users may export search results to a CSV file. Form 5500 filings with the Department since January 2010 are available in the new search tool.

44 pages. "The overall average expense for all respondents to administer the funds and to pay investment manager fees is 55 basis points. This is down from 60 basis points in the prior year.... Reporting funds saw, on average, one-year returns around 4.5 percent.... The average assumed rate of return on investment for responding funds is 7.24 percent, compared with 7.34 percent last year.... About 82 percent of all responding funds are considering lowering or have lowered their assumed rate of return, and 51 percent are implementing or considering higher benefit age/service requirements."

15 pages. "All private employers with at least one employee in Massachusetts have PFML obligations, including collecting and remitting covered employees' contributions to the trust fund or maintaining an approved private plan. Employers with 25 or more employees in the state must also contribute to the PFML program, but smaller employers are exempt from making contributions."

"Most plans have a set period (such as March 31 of the following year, for a calendar year plan) to submit expenses for the prior year. If any money is left over after that period, the employer has four options.... [T]he employer should make sure that its plan document permits any or all of these options ... Employers using a third-party administrator (TPA) to administer the health FSA should also make sure the option they choose can be handled by the TPA."

"Starting with the 2021 Plan Year, 401(k) plan sponsors will need to track hours of service performed by part-time employees ... and will be required to permit certain part-time employees to make elective deferrals in a 401(k) Plan beginning in the 2024 Plan Year.... The SECURE Act increases by ten-fold the penalties in connection with failing to file an annual report for a qualified retirement plan.... [E]mployers should analyze their leave programs and make sure they do not want to make changes to take the tax credit in 2020.... [T]ax-exempt employers no longer need to include the value of qualified transportation fringe benefits in their UBIT."

"[1] Expanding leave entitlement by redefining threshold eligibility.... [2] Improper identification and description of your FMLA leave year.... [3] Inaccurate or non-compliant rules about required or permissive substitution of paid time off and/or disability benefits during leave.... [4] Failing to describe employees' notice obligations (or failing to accurately capture difference between foreseeable and unforeseeable situations).... [5] Outdated information about military family leave entitlements.... [6] Explanation of what happens if employee fails to pay benefit premiums during leave.... [7] Overstating fitness for duty requirements.... [8] Failing to attach DOL's FMLA Poster or include all of its detail in the policy.... [9] No state law addendums where required  ... [10] Leaving out descriptions of employer's recertification and second/third opinion rights."

"With the passage of the SECURE Act, ... IRA Account owners must now reduce their intended [Qualified Charitable Contributions (QCDs)] by any contribution amounts made into their IRAs after age 70-1/2 (the age cap in place to make IRA contributions before passage of the SECURE Act), to the extent they have not already been used to reduce their QCD. In other words, IRA contributions made after age 70-1/2 cannot be turned around to be used as QCDs… and the rules effectively require a 'LIFO' treatment that ensures post-age 70-1/2 contributions will first and foremost be used to reduce future QCDs."

Rev. Nov. 2019. "Small businesses may choose to offer IRAs, defined contribution plans, or defined benefit plans. Many financial institutions and retirement plan practitioners make available one or more of these retirement plans that have been pre-approved by the IRS. [This publication includes] a chart outlining the advantages of each of the most popular types of IRA-based and defined contribution plans and an overview of a defined benefit plan."

"Given the challenges associated with common law marriage, here are some best practices for employers to consider: [1] Determine if you have employees in states that allow common law marriage.... [2] Consider whether qualifying events that result in a person adding or dropping a spouse should require evidence (and what evidence is required). [3] Include the evidence requirement in the applicable plan language.... [4] Apply the evidence requirement consistently with all impacted employees."

"Many of the provisions in the SECURE Act ... will require significant changes to plan administration and recordkeeping.... [1] Lifetime minimum required distributions delayed ... [2] Post-death minimum required distributions accelerated ... [3] Safe harbor 401(k) plan ... [4] Expanded small employer plan tax credits ... [5] Nondiscrimination, coverage and minimum participation relief ... [6] Expanded disaster relief ... [7] New in-service withdrawal right for child birth and adoption expenses ... [8] In-service withdrawal right from pension, 457(b) plans ... [9] Part-time participation for 401(k) plans ... [10] Form 5500 changes and increased penalties."

"Many of the tasks assigned to them will be familiar to [pooled plan providers (PPPs)] from their experience with prototype plans, but others will not, such as adjudicating claims disputes, approving qualified domestic relations orders, and tracking credit for vesting service.... [T]he mandated assumptions [for disclosure of annuity estimates] may yield results so approximate as to be useless, if not seriously misleading.... [E]mployers [should] make sure that they track part-timers' hours in order to identify those who may have to be offered participation [starting in 2024].... [W]ithdrawals [for childbirth or adoption expenses] may be repaid to an IRA (or, in some cases, to the defined contribution plan from which they were taken), in which case they will be treated as having been rolled over (and therefore not subject to income tax)."

"The US Supreme Court has announced it will hear a case in the coming months that could determine whether states have the right to regulate pharmacy benefit managers (PBMs).... The Eighth Circuit decision favored the Pharmaceutical Care Management Association (PCMA), ruling that [ERISA], a federal law that sets minimum standards for voluntarily established retirement and health plans in private industry, superseded an Arkansas law that sought to regulate PBMs." [Pharmaceutical Care Mgmt. Assoc. v. Rutledge, Nos. 17-1609 and 17-1629 (8th Cir. June 8, 2018; cert. pet. granted Jan. 13, 2020)]

"The SECURE Act provides expanded relief from nondiscrimination, minimum coverage, and minimum participation testing, but only in specific circumstances and subject to detailed requirements. Generally, these provisions give new tools for closed and frozen DB plan sponsors to pass these tests, thus allowing the plan to continue coverage and benefits for the closed or frozen plan participants."

29 pages. "81% of plan sponsors believe helping their employees with financial wellness is a very important or important priority for the over the next two years.... More than half of health care organizations say that their current plan provider could do more to help with employee retirement readiness and overall financial wellness.... Average NHCE participation among our sample is 67% and the average NHCE deferral rate is 8%."

15 pages. Topics: [1] Introduction to ERISA statute of limitations issues; [2] ERISA statute of limitations for benefit claims; [3] Resetting a statute of limitations, tolling, waiver, and estoppel; [4]  Statute of limitations standard for breach of fiduciary actions; [5] Intel Corp. case expected to crystallize the actual knowledge test.

10 pages. Topics include: [1] Section 404 issues; [2] Executive orders (EOs); [3] Filings under Rev. Proc. 2017-57; [4] Hybrid determination letters (DLs); [5] More hybrid DLs; [6] Employer discretion; [7] Substitute Mortality Tables (SMTs); [8] Funding balance elections; [9] Phased retirement; [10] Mortality for IRC Section 430/Section 436; [11] Weekend/holiday rule for funding; and [12] Multiemployer plans.

7 pages. Topics include: [1] PBGC changes; [2] Pilot Mediation Program; [3] Discussion of PBGC Regulatory Agenda; [4] Plan termination issues; [5] Multiemployer plans; and [6] Other PBGC topics.

"Compliance with [HSA] rules can become especially complex when married couples are collectively covered by more than one high-deductible health plan. Both spouses may want to take advantage of the benefits of HSAs, but must coordinate with each other in the process."

"The proposed regulations provide extensive guidance on  ... [1] What constitutes a publicly held corporation (public company) subject to 162(m). [2] How the 'covered employees' of a public company are determined, including extensive rules with respect to what constitutes a 'predecessor corporation' whose covered employees need to be considered. [3] Extensive guidance with respect to the exception from the new rules in the case of written binding contracts in effect on November 2, 2017."

"[The] Healthcare Affordability State Policy Scorecard identifies areas where states are doing well and areas where it can improve. As the scorecard shows, state policymakers have a robust toolset they can use to ensure all residents have affordable coverage that features consumer-friendly cost-sharing and whose premiums reflect the efficient delivery of healthcare and fair healthcare pricing."

34 pages. "What's New Cents-per-mile rule. The business mileage rate for 2020 is 57.5 cents per mile.... For 2020, the monthly exclusion for qualified parking is $270 and the monthly exclusion for com muter highway vehicle transportation and transit passes is $270.... For plan years beginning in 2020, a cafeteria plan may not allow an employee to request salary reduction contributions for a health FSA in excess of $2,750."

"[E]mployers should: [1] Begin to establish internal procedures for tracking covered employees, and consider strategies to address covered employees in future acquisitions. [2] Ensure that they can identify the extent to which these employees' benefits are grandfathered under the Proposed Regulations.... [3] Determine whether any of their plans require payments to be delayed until the first year in which the employer's deduction for the payment would not be subject to the Code Section 162(m) limit."

"[Changes include:] [1] Section 6.02 has been modified to provide a list of applicable documents that should be submitted with determination letter request applications to enable the IRS to more efficiently process them.... [2] Section 8.02 has been modified to add a category of determination letter requests submitted by an adopting employer (or a controlling member of a multiple employer plan, if applicable) of a pre-approved plan with respect to the third (and subsequent) six-year remedial amendment cycles, under Rev. Proc. 2017-41 ... [3] Section 9.07 has been revised to delete a sentence that provided that a favorable determination letter does not constitute a determination with respect to the federal tax consequences of a lump sum risk transferring program."