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Retirement Plans Newsletter October 8, 2020 |
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Newly Posted The Rising Threat of Cyber Attacks: How to Keep Retirement Benefit Plans and Plan Administration Secure
Voluntary Fiduciary Correction Program
Fiduciary Responsibility Doesn’t Have to Keep You Up at Night
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Discussions |
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This Newsletter:
BenefitsLink Health & Welfare Plans Newsletter:
Message Boards Digest:
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[Guidance Overview]
"Employers with consistent compliance failures, a lack of retirement expertise, limited HR resources, and a fear of the regulatory and litigation risk could be great fits for a PEP. However, not all employers are, and not all PEPs will be structured to deliver all of an employer's needs.... Employers will need to approach PEPs much as they do other retirement plan considerations: Identify the challenges their plan currently presents and determine if a PEP can meet them." Lockton |
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[Sponsored]
Automate and cut your distribution processing time in half! ftwilliam.com's 100% cloud-based Distribution Tracking Software (DTS) automates your loan modeling and distribution tracking process, including plan terminations, partial plan terminations, force-out campaign and hardship withdrawals. Learn more!
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[Guidance Overview]
"The final regulation -- which is identical to the proposed version -- removes the temporary regulation and sets basic ground rules for withholding on periodic payments without establishing a new default withholding rate.... [T]he regulation indicates that the rules applicable to withholding certificates for periodic payments will 'parallel' the rules for wage withholding unless the Code's rules for periodic payments specifically provide otherwise." Thomson Reuters / EBIA |
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[Guidance Overview]
"[Notice 2020-68] provides answers to at least some of the open questions concerning the retirement plan changes under the SECURE Act. In particular, the notice includes useful guidance on the Act's new rules regarding 401(k) plan participation by long-term, part-time employees and so-called 'qualified birth or adoption distributions' (QBOADs)." Bond, Schoeneck & King |
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"The plaintiff named Abbott Labs as a defendant, but the court dismissed these claims on the ground that plaintiff did not show that Abbott Labs acted as a fiduciary or was identified as a fiduciary in the plan document.... The court refused to dismiss allegations that an Illinois consumer protection statute was violated, finding that the state law was not preempted by ERISA. Alight may have committed an unfair business practice as defined in that law when Alight failed to implement security practices that would have prevented the theft, failed to protect personal information or to notify plaintiff promptly of changes to her account." [Bartnett v. Abbott Laboratories, No. 20-2127 (N.D. Ill. Oct. 2,
2020)] Cohen & Buckmann, P.C. |
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"The combination of the work-from-home model most workers are experiencing, coupled with the anxiety and emotional distress retirement plan participants could be feeling given market volatility and job losses related to the pandemic, provides a ripe target.... Here are several tips plan sponsors can share with participants to promote fraud prevention." 401(k) Specialist |
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[Sponsored]
TRANSIT EMPLOYEES’ PENSION PLAN (TEPP) RFP for Legal Services The Board of TEPP is accepting proposals for a firm to provide Legal Services as stated in RFP requirements. TEPP is a non-ERISA, collectively bargained, governmental pension plan. Proposals are due 10/26/2020 @2:00 PM, CST. Contact cnoll@mcts.org |
"[There are] phrases commonly used in retirement plan and/or financial wellness communications that, while they may be true, might actually scare people away from saving.... You need to save at least 10% for a secure retirement ... You should have six months of emergency savings ... Debt is a destroyer of wealth and should be eliminated." Cammack Retirement Group |
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"ESG adoption was highest by plans in the Northeast and on the West Coast.... The most frequently cited reason for incorporating ESG among respondents was to address stakeholder concerns. Conversely, the most frequently cited reason for not incorporating ESG was because the benefits of ESG incorporation were unproven or unclear." Callan |
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"The US stock market hit an all-time high on September 2nd but reversed course and declined close to 4% by month end. Pension discount rates were little changed from the previous month. Many plans will see funded status deteriorate over the month to varying degrees mainly depending on their level of equity exposure." River and Mercantile Solutions |
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"This article examines data from a variety of sources to assess whether state and local governments currently satisfy the federal standards for retirement plan sufficiency and whether the standards ensure benefits equivalent to those from Social Security." Laura Quinby, Jean-Pierre Aubry and Alicia H. Munnell, via SSRN |
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[Opinion]
"Chief among the ARA's concern is that the proposal underestimates the time needed to comply with the registration requirements in advance of Jan. 1, 2021, starting date.... ARA says that it does not believe that all marketing activities should be treated as beginning operations.... ARA contends that some of the data elements of final Form PR filings may be redundant to the final Form 5500." American Retirement Association [ARA] |
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[Opinion]
"What the rule correctly recognizes is that fund managers are entirely justified in assuming that plan beneficiaries favor value maximization as the touchstone for proxy vote decision-making, but they would be equally unjustified in assuming those same beneficiaries support ESG corporate activism. CRC feels that the Department's proposed rule appreciates this reality, and provides meaningful guidance to fiduciaries seeking to fulfill their duty to maximize the value of the assets they manage." Capital Research Center |
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Benefits in General |
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"Expand your definition of benefits ... Allow for flexibility and choice ... Prepare to meet people where they are ... Decide what options are no longer relevant and how to pay the right price for the rest ... Be up front about how rewards are linked to the state of the business ... Help employees use their benefits." PwC |
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Executive Compensation |
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4-page article, beginning at page 23 of 85-page document. "[This article examines] the forces have led to the increased use of ESG metrics in incentive compensation plans and action items for companies looking to consider incorporating ESG metrics into their incentive compensation programs." Shearman & Sterling LLP |
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Selected Discussions |
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► It's easy to sign up and participate in discussions! Post answers, ask questions, create custom feeds and views. Join your peers (and potential referral sources or customers)—there is no charge. |
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"2020 plan year is top heavy. Client has discretionary SHNE but cannot afford to fund SHNE or the top heavy minimum. Can the key employees withdraw all of their 2020 contributions (with earnings) in order to bypass the top heavy minimum contribution? I'm thinking this is a big no-no, but would like some proof. If any responses could have some regs pasted in, that would be fantastic." BenefitsLink Message Boards |
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► Subscribe to the BenefitsLink Message Boards Digest -- a free daily email of all new discussions (not just the selected few shown above). View a sample issue. |
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Press Releases |
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Most Popular Items in the Previous Issue |
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DOL's Final Rule Creates a New Electronic Disclosure Safe Harbor for Retirement Plans (PDF)
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DOL's Proposed Rule on Pooled Plan Provider Registration (PDF)
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Private Equity Fund Liability Under ERISA (PDF)
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BenefitsLink.com, Inc.
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Winter Park, Florida 32789
(407) 644-4146
Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
Article submission: Online form
BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2020 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.
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