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January 12, 2021 logo logo
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[Official Guidance]

Text of DOL Field Assistance Bulletin 2021-01: Temporary Enforcement Policy Regarding the Participation of Terminating Defined Contribution Plans in the PBGC Missing Participants Program

"This memorandum announces the [DOL's] temporary enforcement policy on terminating defined contribution plans' (e.g., 401(k) plans) use of the [PBGC's] expanded Missing Participants Program. The policy applies to fiduciaries of terminating defined contribution plans and qualified termination administrators (QTA) of abandoned individual account plans....

Pending further guidance, the Department will not pursue violations under section 404(a) of ERISA against either responsible plan fiduciaries of terminating defined contribution plans or QTAs of abandoned plans ... in connection with the transfer of a missing or non-responsive participant's or beneficiary's account balance to the PBGC in accordance with the PBGC's missing participant regulations rather than to an IRA, certain bank accounts, or to a state unclaimed property fund, ... if the plan fiduciary or QTA complies with the guidance in this memorandum and has acted in accordance with a good faith, reasonable interpretation of section 404 of ERISA with respect to matters not specifically addressed in this memorandum.

However, this temporary enforcement policy does not preclude the Department from pursuing violations under sections 404 or 406 of ERISA for a failure to diligently search for participants and beneficiaries prior to the transfer of their account balances to the PBGC or from pursuing violations under sections 107, 209 or 404 of ERISA for a failure to maintain plan and employer records. This memorandum expresses a temporary enforcement policy; it does not address the rights or obligations of other parties. To the extent this memorandum conflicts with the distribution guidance of Field Assistance Bulletin 2014-01, this memorandum controls." Icon to read more

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

[Official Guidance]

Text of EBSA Compliance Assistance Release 2021-01: Terminated Vested Participants Project -- Defined Benefit Pension Plans

"The purpose of this memorandum is to ensure consistent investigative processes and case-closing practices among [EBSA's] Regional Offices conducting Terminated Vested Participants Project (TVPP) audits and to facilitate voluntary compliance efforts by plan fiduciaries.... The TVPP has three key objectives for defined benefit pension plans. First, to ensure these plans maintain adequate census and other records necessary to determine (a) the identity and address of participants and beneficiaries due benefits under the plan, (b) the amount of benefits due under the plan, and (c) when participants and beneficiaries are eligible to commence benefits. Second, to ensure these plans have appropriate procedures for advising participants with vested accrued benefits ('terminated vested participants' or 'TVPs') of their eligibility to apply for benefits as they near normal retirement age and the date they must start required minimum distributions (RMDs) under federal tax law. Third, to ensure these plans implement appropriate search procedures for terminated participants and beneficiaries for whom they have incorrect or incomplete information.... [This Compliance Assistance Release provides guidance for Regional Directors about:] Opening the investigation ... Information we ask for ... Errors we look for ... How cases are closed." Icon to read more

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Missing Participants: Best Practices for Defined Benefit and Defined Contribution Plans

"This document outlines best practices that the fiduciaries of defined benefit and defined contribution plans, such as 401(k) plans, can follow to ensure that plan participants and beneficiaries receive promised benefits when they reach retirement age.... Based on EBSA's experience working with plans, the following practices have proven effective at minimizing and mitigating the problem of missing or nonresponsive participants. [1] Maintaining accurate census information for the plan's participant population.... [2] Implementing effective communication strategies.... [3] Missing participant searches.... [4] Documenting procedures and actions." Icon to read more

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL], Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2021, 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, 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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