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Retirement Plans Newsletter

August 2, 2021

3 New Job Opportunities


[Guidance Overview]

PBGC Rules on Special Financial Assistance to Multiemployer Plans: Effect on Benefits, Contributions, Withdrawal Liability, and Plan Design

"PBGC specified that withdrawal liability is to be determined using PBGC mass withdrawal assumptions to value vested benefits for the later of ten years or the date SFA and earnings on SFA are depleted. Mass withdrawal assumptions are based on annuity purchase prices and therefore result in a conservative valuation.... The Rule also requires PBGC approval of any settlement of withdrawal liability claims in excess of $50 million."  MORE >>

The Wagner Law Group

[Guidance Overview]

DOL Clarifies Lifetime Income Disclosure Requirement

"The FAQs clarify that plans can provide participants with multiple [lifetime income illustrations (LIIs)].... This clarification may be helpful for plans that want to deliver various LIIs that, for example, take future contributions or in-plan annuity options into account. However, DOL has not extended the SECURE Act's fiduciary safe harbor for LIIs to any LIIs other than those meeting the requirements of the IFR."  MORE >>

Groom Law Group

[Guidance Overview]

Including Long-Term Part-Time Employees in 401(k) Plans

"[T]he SECURE Act changed the rules that permitted 401(k) plans to exclude individuals who worked less than 1,000 hours in the plan year.... [Unanswered questions include:] Can an equivalency method be used for counting service? How should a plan handle any missed deferral opportunities for [long-term part time (LTPT)] employees? Will LTPT employees be counted as 'participants' for purposes of the Form 5500? Will the LTPT rules apply to 'grandfathered' governmental plans? Will the LTPT rules apply to church 401(k) plans?"  MORE >>


Ninth Circuit Affirmation of CalSavers Decision May Forecast State Auto-IRA Nightmare for Some Employers

"The CalSavers decision clearly does not provide for a blanket exemption to other state programs and thus, ERISA preemption will likely continue to be considered on a program by program basis.... This patchwork of programs that vary from jurisdiction to jurisdiction will present compliance challenges that are not insignificant for multistate employers, particularly those with nontraditional workforces who historically have not been eligible to participate in an employer sponsored retirement savings plan." [Howard Jarvis Taxpayers Ass'n v. California Secure Choice Ret. Savings Program, No. 20-15591 (9th Cir. May 6, 2021)]  MORE >>

Thompson Hine

Great-West Defendants Prevail in Appeal of Fee Challenge

"Much of the text of the appeals court ruling is spent recounting the factual background of the case, including discussion of many actions taken by Great-West defendants to review and reconsider the investment fees questioned by the plaintiffs. The ruling also considers in close detail the legal analysis of the district court, backing its conclusions time and again[.]" [Obeslo v. Great-West Life & Annuity Ins. Co., No. 20-1310 (10th Cir. Jul. 26, 2021)]  MORE >>

PLANSPONSOR; free registration may be required

Should 401(k) Plans Permit Cryptocurrency on the Investment Menu?

"Although the [DOL] has not come out with any guidance regarding cryptocurrencies, plan investment options must be appropriate for all participants, including less sophisticated ones. The DOL could determine that participants shouldn't be given an opportunity to gamble their retirement money and that cryptocurrencies shouldn't be a separate asset class on a plan's investment menu."  MORE >>

Carol Buckmann, via RPA Convergence

Practical Takeaways on EBRI's Retiree Profile Research (PDF)

"In evaluating the retiree profiles developed by EBRI, ... the most salient drivers of retirement satisfaction and security appear to be guaranteed sources of income, low debt, a clear spend-down strategy, and employer-sponsored retirement help, including advisory services. "  MORE >>

Employee Benefit Research Institute [EBRI]

Legislation Introduced to Encourage Retirement Product Innovation

"A bill to lower barriers to innovative retirement income products by requiring the [SEC] to revise its rules regarding the development and offering of certain annuity products was introduced in the House of Representatives ... The Registration for Index Linked Annuities Act [HR 4865] directs the SEC to devise a new form for annuity issuers to use when filing registered index-linked annuities (RILAs)."  MORE >>

Insured Retirement Institute [IRI]

SSA OIG Report: Follow-Up on 2011 Audit of Old-Age, Survivors and Disability Insurance Benefits Affected by State and Local Pensions

"In a 2011 audit, [OIG] estimated SSA overpaid approximately 24,900 beneficiaries about $623.8 million. These beneficiaries would receive approximately $869.9 million in additional overpayments over their lifetimes unless SSA corrected these payment errors.... [OIG] reviewed SSA's actions to implement the three recommendations in [the] 2011 audit and found that, although SSA made efforts, work still needs to be done. Two of the three recommendations involved systematic changes needed for SSA to effectively identify beneficiaries whose benefit must be adjusted because of WEP or GPO."  MORE >>

Social Security Administration Office of the Inspector General [OIG]

Benefits in General

[Guidance Overview]

Recordings of Phone Calls Made for Quality Assurance Purposes Must Be Disclosed to ERISA Benefit Claimants

"Plan administrators should work with their carriers or third party administrators to ensure that such recordings are retained for the relevant limitations period, and are disclosed upon request, even if the recordings were not relied upon in denying the claim."  MORE >>

Hodgson Russ LLP

[Guidance Overview]

Plan Cybersecurity Guidance: DOL Enforcement Warrants Plan Sponsor Action

"Although the most detailed piece of the package -- the best practices summary -- is framed as applying to plan service providers (such as recordkeepers and administrators), enforcement actions already implemented suggest that these standards likely also apply to plan-related information maintained by the plan fiduciary.... [P]lan sponsors and fiduciaries should be aware that this cybersecurity guidance likely applies to all plans governed by ERISA, not just retirement plans."  MORE >>

Poyner Spruill LLP

Employee Benefits Jobs

View job as DC Senior Plan Administrator
for Steidle Pension Solutions DC Senior Plan Administrator

Steidle Pension Solutions

Remote / NJ / PA

View job as DC Senior Plan Administrator
for Steidle Pension Solutions

View job as Retirement Plan Internal Sales Analyst
for ERISA Services, Inc. Retirement Plan Internal Sales Analyst

ERISA Services, Inc.

Knoxville TN

View job as Enrolled Actuary
for McHenry Advisers, Inc. Enrolled Actuary

McHenry Advisers, Inc.

New Albany OH

Selected New Discussions

DB Plan Distribution to a Restricted HCE -- Need a Insurer to Sell Us a Bond

"One of the 25 highest paid restricted HCE in a DB plan wants payment of his benefits as a lump sum. He does not want to deposit funds into an escrow. Can anybody recommend an insurer that would sell a bond to cover his restricted benefit? Greatly appreciated."

BenefitsLink Message Boards

No S-8 Needed If 401(k) Sponsor Decides to Use Company Stock to Make Matching Contributions?

"A public company client is thinking of adding employer stock to its plan. It would match in employer stock. The employer stock received would be sold and invested according to the employee's wishes unless the participant affirmatively elected to keep the stock. No participant could elect to purchase any employer stock with their own funds. In these circumstances, there would not be an investment decision on the part of the participant (even the election to get stock or cash). So, no S-8 would be required, but the participants and the plan would hold 'restricted securities' that must be sold in accordance with Rule 144 or some other exemption. Anyone hear of a company actually do this? If so, how do they handle resales of the unregistered shares?"

BenefitsLink Message Boards

Press Releases

HBL Welcomes Partner Tim Kennedy, Opens Philadelphia Office

Hall Benefits Law

Last Issue's Most Popular Items

Text of IRS Notice 2021-48: Guidance on Single-Employer Defined Benefit Pension Plan Funding Changes Under the American Rescue Plan Act of 2021 (PDF)

Internal Revenue Service [IRS]

DOL Clarifies Timing of Lifetime Income Disclosures in Benefit Statements

Kilpatrick Townsend

DOL Provides FAQs on Interim Final Rule on Lifetime Income Disclosures for DC Plans


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

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