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Retirement Plans Newsletter

October 20, 2023

2 New Job Opportunities 2 New Job Opportunities


[Guidance Overview]

DOL Issues Advisory Opinion on Payment of Plan Investment Management Fees Under Corporate Racial Equity Program

"There are interesting parallels between the DOL's views in [Advisory Opinion 2023-01A ] and its most recent position on [ESG] factors with respect to investment decision-making involving ERISA plan assets. In both scenarios, fiduciary investment decision-making can comply with ERISA even when indirect financial or other benefits may flow to non-participants or the public-at-large, but fiduciaries must base their decisions on financial factors and a risk/return analysis that benefit the plans and their participants."  MORE >>

Miller & Chevalier

[Guidance Overview]

SECURE 2.0: Navigating the Compliance Landscape

"Employers, recordkeepers, payroll providers, consultants, and legal counsel will need to work closely in conjunction to implement and ensure plans are operating in compliance with the SECURE Act changes, and plan sponsors will need to educate and inform plan participants regarding these changes. Certain provisions may require manual workarounds as some service providers may not have an automated platform available or still need to update software programs to accommodate the changes. It is important that service providers have an operational checklist to assist plan sponsors in documenting and tracking elections until the plan amendment is signed."  MORE >>

Enterprise Iron

[Guidance Overview]

Managers of Plan Asset Funds: Important December 1, 2023 Deadline for DOL's Proxy Voting Rule

"Existing ERISA investors in plan asset vehicles [should] review, confirm and document that the Plan Asset Manager's investment policy statement and proxy voting policies are consistent with Title I of ERISA. To the extent the Plan Asset Manager retains a proxy voting service for the voting of proxies, it must undergo a similar review and document that such proxy voting service's voting policies are consistent with Title I of ERISA."  MORE >>

Vedder Price

Supreme Court Declines to Hear Two ERISA Class Action Waiver Cases

"The U.S. Supreme Court has declined to hear two cases concerning the enforceability of mandatory arbitration and class action waivers in plan documents.... Both cases alleged that private equity in employee stock ownership plans was improperly valued at the expense of the participants.... In both circuit court outcomes, the defendants' moves to force individual arbitration and prevent a class action remedy were denied." [Harrison v. Envision Mgmt. Holding, Inc. Bd. of Directors, No. 22-1098 (10th Cir. Feb. 9, 2023; Argent Trust Co. v. Harrison, No. 23-30, cert. denied Oct. 4, 2023); Henry v. Wilmington Trust NA, No. 21-2801 (3d Cir. Jun. 30, 2023; cert. pet. denied Oct. 16, 2023)]  MORE >>


More Lawsuits Say Forfeiture Reallocation Was a Fiduciary Breach

"Two more suits in two different California federal district courts have just challenged the use of plan forfeitures to offset company contributions as not being in the best interests of plan participants.... The suits acknowledge the discretion to do so, but position that decision as having “consistently chosen to utilize the forfeited funds in the Plan exclusively for the Company’s own benefit, to the detriment of the Plan and its participants, by using these Plan assets solely to reduce Company contributions to the Plan.”" [(McManus v. Clorox Co., No. 23-5325 (N.D. Cal. complaint filed Oct. 18, 2023)]  MORE >>

American Retirement Association [ARA]

OMB Stakeholder Meetings Mark Final Step Before Issuance of New DOL Fiduciary Rule

"Since the rule was delivered to the OMB in early September, organizations from the Securities Industry Financial Markets Association [SIFMA] and Financial Services Institute to the Institute for the Fiduciary Standard and the Consumer Federation of America, have held meetings with OMB and DOL officials concerning the new rule ... At the heart of the disputes between these advocacy groups is whether the [SEC's] Regulation Best Interest and National Association of Insurance Commissioners' best interest rule for annuity recommendations negate the need for a revised DOL fiduciary rule."  MORE >>

DOL Embarks Upon SECURE 2.0 Plan Disclosure Reforms

"[EBSA] on Oct. 18 notified the White House Office of Management and Budget (OMB) that it intends to begin consulting with stakeholders -- including participant representatives, employers sponsoring ERISA retirement plans, and retirement plan service and investment providers -- to explore alternatives for improving the understandability and effectiveness of such plan disclosures."  MORE >>

American Retirement Association [ARA]

Important Facts About 401(k) Plans (PDF)

14 pages. "[1] 401(k) plans represent the largest share of DC plan assets.... [2] Most 401(k) plan participants receive plan contributions from their employers.... [3] Equities figure prominently in 401(k) plans, especially among younger 401(k) investors.... [4] 401(k) plan participants have concentrated their assets in lower-cost funds.... [5] Fewer than one in five 401(k) plan participants have loans outstanding."  MORE >>

Investment Company Institute [ICI]

Benefits in General

[Official Guidance]

Text of IRS Final Regs: User Fees Relating to Enrolled Actuaries

"These final regulations amend existing regulations relating to user fees for enrolled actuaries. The final regulations increase both the enrollment and renewal of enrollment user fees for enrolled actuaries from $250 to $680."  MORE >>

Internal Revenue Service [IRS]

Employers Using Financial Wellbeing Programs to Increase Worker Satisfaction and Retention

"Benefits decision makers cited high costs of living as the top issue to address with financial wellness initiatives, supplanting retirement preparedness for the first time ever. While retirement preparedness remains an important area of focus for employers as the second-most cited area to address, issues such as health care costs, budgeting and money management and daily living expenses rounded out the top five, perhaps signaling an increase in employers' concern for their workers' day-to-day finances."  MORE >>

Employee Benefit Research Institute [EBRI]

Executive Compensation and Nonqualified Plans

Year-End 2023: Financial and Tax Planning for Equity Comp and Company Shares

"Year-end is a key time for financial and tax planning with stock options, restricted stock and RSUs, employee stock purchase plans, and the acquired company shares.... [These resources] can help you identify areas in your equity comp picture where you can take meaningful action before the end of 2023."  MORE >>

Employee Benefits Jobs

View job as Employee Benefits Account Manager
            for U.S. Retirement & Benefits Partners

Employee Benefits Account Manager

U.S. Retirement & Benefits Partners

Rochester NY / Hybrid

View job as Employee Benefits Account Manager for U.S. Retirement & Benefits Partners

View job as Retirement Plan Services Manager
            for Kolinsky Wealth Management

Retirement Plan Services Manager

Kolinsky Wealth Management

Ramsey NJ

View job as Retirement Plan Services Manager for Kolinsky Wealth Management

Selected New Discussions

Church Plan Exception to SECURE 2.0 Auto-Enroll Requirement

"Church or government agencies are exempt from being required to have auto-enroll starting in 2025. Maybe I'm just reading too much into this, but is the exemption applicable to a plain old non-denominational church that wants a 401k plan? They do outreach programs and such, but it all centers on their church. They would prefer not to have auto-enroll and I think this would fit the exception to the rule."

BenefitsLink Message Boards

Deceased Missing Participants

"We are terminating a defined benefit plan with many former employees. We used a locator service to find addresses for all of the former employees and have learned that several of the former employees are now deceased. What do we have to do to determine if they were married and to find the spouse since the plan has a QJSA payable to the spouse?"

BenefitsLink Message Boards

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

How the Demise of the Death Master File is a Problem and an Opportunity for Insurance Companies

November 1, 2023 WEBINAR

PBI Research Services

Fiduciary Training Part IV: Staying Ahead of Retirement Plan Audits

November 2, 2023 WEBINAR

CAPTRUST Financial Advisors

Last Issue's Most Popular Items

Text of IRS Notice 2023-73: Mortality Table for Use in Determining Minimum Present Value for 2024 (PDF)

Internal Revenue Service [IRS]

IRS Updates Regulations for Use and Timing of Forfeitures (PDF)

Groom Law Group, via Journal of Pension Benefits

Text of IRS Final Regs: Mortality Tables for Determining Present Value under Defined Benefit Pension Plans

Internal Revenue Service [IRS]

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

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