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Retirement Plans Newsletter

November 8, 2022

4 New Job Opportunities 4 New Job Opportunities


[Guidance Overview]

A Rollover Recommendation Is a Securities Recommendation

"The SEC and FINRA are in alignment with the DOL's position that a recommendation to roll over is, in effect, a securities recommendation ... This may explain why the DOL, SEC and FINRA all expect broker-dealers and investment advisers to have information about the investments held in a participant's account, that is, how can a 'sell' recommendation be made without knowing the investments that the recommendation covers."  MORE >>

[Guidance Overview]

If You Give Rollover Advice to IRA Owners, Act Now: The Compliance Deadline Has Passed (PDF)

"Any fiduciary advisor who recommends that a client move assets from a plan to an individual retirement account (IRA) risks engaging in a prohibited transaction if the advisor is paid as a result of the recommendation.... [T]he Investment Advice PTE [PTE 2020-02] provides ready relief if the conditions of the exemption are met.... [T]he Investment Advice PTE is now fully effective -- the deadline was July 1, 2022. This could be a bomb that squarely hits unwary wealth managers[.]"  MORE >>

The Wagner Law Group

[Guidance Overview]

Big News on the Multiemployer Pension Front: What Contributing Employers Need to Know

"[PBGC] has issued a proposed regulation on permissible actuarial assumptions to be used in withdrawal liability calculations that would allow multiemployer plan actuaries to use much lower interest rates than courts have recently allowed. If that regulation is finalized more or less 'as-is,' it will in many cases significantly increase the cost of withdrawing from a multiemployer plan. The good: the Ninth Circuit Court of Appeals ruled in favor of a withdrawing employer on this issue, rejecting the application of the terms of the proposed regulation to the withdrawal transaction under consideration." [GCIU -- Employer Retirement Fund v. MNG Enterprises, Inc., Nos. 21-55864 and 21-55923 (9th Cir. Oct. 28, 2022)]  MORE >>

October Three Consulting

[Guidance Overview]

PBGC Issues Proposed Regs on Interest Rate Assumptions to Use for Calculating Withdrawal Liability

"The proposed rule would specifically permit the use of ERISA Section 4044 rates as reasonable either as a standalone assumption, or combined with funding interest rate assumptions, to determine withdrawal liability from ongoing plans."  MORE >>


Magistrate Recommends 180° Course Correction on Previously Denied Motions to Dismiss in ERISA Fee Litigation Cases

"If the recommendations are adopted, these would be the third and fourth motions to dismiss granted in full, along with one that was granted in part, in the Seventh Circuit since Albert, representing a near 100% success rate for defendants since issuance of the decision." [Nohara v. Prevea Clinic, No. 20-1079 (E.D. Wis. magistrate report filed Oct. 27, 2022); Glick v. Thedacare, No. 20-1236 (E.D. Wis. magistrate report filed Oct. 27, 2022)]  MORE >>


Arbitration of ERISA Retirement Plan Disputes (PDF)

16 pages. "This practice note discusses the general enforceability of arbitration clauses in certain disputes, including class actions, with a particular focus upon the enforceability of arbitration clauses involving legal claims made under [ERISA]. This practice note also specifically analyzes the advantages and disadvantages of arbitration provisions for retirement plan sponsors."  MORE >>

The Wagner Law Group via LexisNexis Practical Guidance

Orphan Accounts Pose Fiduciary Liability for 401(k) Plan Sponsors

"Once an account becomes 'lost,' a series of unfortunate events can occur.... [E]ven if these accounts aren't 'lost,' the people who own them can still present problems.... With the passage of time, this burden of communication becomes more cumbersome.... The cumulative impact of these fees can amount to a hefty sum. And these are just the fees you see on the surface.... Because of all these complicating matters, it remains foggy as to what is truly in the best interest of the former employee."  MORE >>

Fiduciary News; free registration required

2023 Lump Sums from Defined Benefit Plans Will Be Much Lower Than Previously Predicted

"For younger vested terminated participants or participants with a small vested benefit, the large lump sum interest spike could cause the present value of their benefit to fall below the $5,000 small lump sum threshold.... [T]he number of participants retiring before the end of 2022 [may] accelerate to lock in these higher amounts ... [C]ash balance plans must offer an equivalent annuity to the cash balance amount. An increase in interest rates ... [may make] a significantly higher 2023 monthly payment quite attractive when compared to the 2022 monthly payment."  MORE >>


What Is SECURE 2.0 and How Are Employers Reacting

"[Alight] asked employers for their perspective on some of the provisions most applicable to their defined contribution plans. In general, employers seem keen on many of the provisions."  MORE >>

Alight Solutions


It's Time to Get Real About 401(k) Plans

"What's working is payroll deducted retirement plans using auto features to get people in the plans, save enough and invest wisely using professionally managed investments.... Focusing exclusively on accumulation and the asset side of a 'personal pension plan' P&L, which is what DC participants are managing, is not working and is dangerous.... The lack of data sharing and the looming war between record keepers and advisors over who gets to serve and monetize participants will not work."  MORE >>

Benefits in General

What Information Should Be in a Claims Denial Letter? (PDF)

"[T]wo cases in federal district court in Utah held that lawsuit filing deadlines were unenforceable because they were not disclosed in the notice of the final claims denial.... [A]nother recent case in Georgia ... held just the opposite ... [T]he more conservative decisions are a good reminder that more information is generally better in claims denial notices.... What must be, and what should be, in your denial letters to claimants?"  MORE >>

KLB Benefits Law Group

Executive Compensation and Nonqualified Plans

[Guidance Overview]

SEC Adopts Final Compensation Clawback Rules; Companies Should Begin Preparing for New Requirements

"For some issuers, the Final Rule may be a floor and not a ceiling on their clawback policies; a broader policy may provide desired deterrent effects that are worth the cost of administration."  MORE >>

Winston & Strawn LLP

[Guidance Overview]

SEC Adopts Final Clawback Rules

"Given that incentive-based compensation is widely used as part of long-term compensation design, a substantial number of issuers will be affected by the final rules.... Under the final rules, the clawback requirement is a bright-line: Recovery is required if the issuer is required to prepare an accounting restatement due to material noncompliance with financial reporting requirements, regardless of any fault or wrongdoing of the executive officer for the accounting errors."  MORE >>

Akin Gump

2023 Qualified Plan Limits Affect Year-End NQDC Deferral Decisions

"[T]he IRS changes in limits from 2022 to 2023 are much larger than they have been in recent years. However, if you've already maxed out your qualified plan contributions for 2022, you will still probably do the same in 2023, so you will need NQDC plans to defer any salary and bonus increases you expect in 2023. Also, if you believe tax increases are on the way and will affect you, you may feel a growing need to defer income."  MORE >>

Employee Benefits Jobs

View job as Retirement Plan Consultant
            for The MandMarblestone Group, llc

Retirement Plan Consultant

The MandMarblestone Group, llc

Remote / Philadelphia PA

View job as Retirement Plan Consultant for The MandMarblestone Group, llc

View job as Senior Conversion Specialist
            for Third Party Administrators, Inc.

Senior Conversion Specialist

Third Party Administrators, Inc.

Remote / Bedford NH

View job as Senior Conversion Specialist for Third Party Administrators, Inc.

View job as Fund Valuation Specialist
            for BPAS

Fund Valuation Specialist


Houston TX

View job as Fund Valuation Specialist for BPAS

View job as Withdrawal Coordinator
            for Northwest Retirement Plan Consultants

Withdrawal Coordinator

Northwest Retirement Plan Consultants


Selected New Discussions

Old QDRO on Civil Service Retirement System

"Anyone work with Civil Service Retirement System (Postal worker)? I am looking at a QDRO for a friend and wondering how something might be interpreted. This is an older QDRO (2003) and is very short. It splits the benefit according to the Majauskas formula, then is says, "The alternate payee shall be treated as a surviving spouse for the purposes of a joint and survivor annuity and pre-retirement survivor annuity purposes". That's about it - it is only 4 paragraphs long. The participant has retired and the AP is getting benefits, but the question is, what happens if the participant dies. There was nothing in the QDRO about required form of payment, but I am wondering if the Normal Form in the Civil Service Plan is a J&S and therefore, saying that that the AP is treated as the spouse for the J&S annuity means they will continue to receive a survivor's portion if the participant predeceases the AP. Any thoughts? I assume the only way to know for sure would be to ask the PA, but I wondered if anyone had any thoughts before we did that."

BenefitsLink Message Boards

ADP and Catch-Up Contributions

"An advisor called me today and asked about how catch-up contributions are treated when an ADP failure occurs. The participant in question always has deferrals returned due to failed testing. However, since Catch-up is not included in the ADP test, how is it treated when there is an excess deferral due to a failed test? My guess is that they would not be able to use the catch-up, so all of the catch-up would come out along with whatever excess was determined. Am I correct in this?"

BenefitsLink Message Boards

Press Releases

Enrique Olivares Joins Centivo as Chief Technology Officer


Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Open Questions Under the SECURE Act


Seyfarth Shaw LLP

Last Issue's Most Popular Items

Text of IRS Rev. Proc 2022-40: Rulings and Determination Letters for Individually Designed Qualified and Section 403(b) Plans (PDF)

Internal Revenue Service [IRS]

Department of the Treasury 2022-2023 Priority Guidance Plan (PDF)

U.S. Department of the Treasury and Internal Revenue Service [IRS]

DOL Proposes to Amend QPAM Exemption (PDF)

Groom Law Group, via The Investment Lawyer

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

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