"Most plans it seems allow forfeitures to be used to pay plan expenses or to reduce employer contributions. It also seems that many plan fiduciaries choose to use forfeitures to reduce employer contributions, rather than pay plan expenses which are charged to participant accounts. This choice is at the heart of the recent litigation. Plan fiduciaries, therefore, may wish to consider amending their plan to eliminate the choice."  MORE >>

"[T]he House Appropriations Committee approved [a 2025 agency budget] bill, which contains policy riders that would prevent the DOL from spending money to administer, implement, or enforce ... the Retirement Security rule and three related rules involving prohibited transaction exemptions.... [T]he House Education and the Workforce Committee voted 23-18 to report a bill (HJ Res 142) to the House floor that would disapprove the DOL's fiduciary rule."  MORE >>

"Many plan fiduciaries currently rely on policy disclosures and contractual representations by a plan's investment managers regarding how they will vote proxies, and/or fiduciaries rely on consultants to evaluate proxy voting practices and may not otherwise devote significant time to proxy voting matters. The court's summary judgment decision suggests that relying on such disclosures and representations, without additional diligence, may subject the plan fiduciaries to litigation risk.... The outcome of the trial and any appeal will need to be taken into account in assessing litigation risks posed by the case." [Spence v. Am. Airlines, Inc., No. 23-0552 (N.D. Tex. Jun. 20, 2024)]  MORE >>

"The [DOL] has delivered a report to Congress on pension risk transfers (PRTs) in defined benefit (DB) plans.... DOL isn't recommending any changes to its PRT guidance at the moment but will continue to study several key issues, with an eye toward potential future amendments.... The report comes amid a series of lawsuits filed in 2024 against DB sponsors that have undertaken PRTs with Athene, an annuity provider owned by a private equity company."  MORE >>

"On June 4, 2024, the Subcommittee on Social Security of the House Committee on Ways and Means convened a hearing at which [the CBO Director] testified about Social Security's finances. After the hearing, Chairman Ferguson and Congressman Feenstra submitted questions for the record. This document provides CBO's answers.... [1] Chairman Ferguson's question about the growth of inflation-adjusted Social Security benefits ... [2] Congressman Feenstra's question about the effects of a payroll tax increase on the economy ... [3] Congressman Feenstra's question about how additional spending for Social Security would affect the economy."  MORE >>

"[If] you want to convert some of your IRA from traditional to Roth, you should convert enough just to the top of your tax bracket.... Accelerating IRA withdrawals can be a good strategy to try to reduce your RMD subject balance. You would probably do that and put it in a Roth unless you needed the money for spending.... The key is to take advantage every year you can of these giant, expanding brackets that have currently very low rates when it comes to your IRA money."  MORE >>

"The end of Chevron deference should serve as a welcome restraint on regulators like the [DOL] to stay within the bounds of the ERISA statute.... The predictions of an increase in regulatory litigation and chaos is likely overblown ... Litigation abuse remains a problem, but the key threat to plan sponsors is not occasional litigation over administrative regulations. It is the constant barrage of frivolous fiduciary-breach lawsuits filed by the trial bar, who sue without regard to a plan sponsor's good faith reliance on regulatory guidance." [Loper Bright Enterprises, Inc. v. Raimondo, Sec. of Comm., No. 22-451 (S. Ct. Jun. 28, 2024)]  MORE >>

"The plaintiffs argue that expanding the injunction from just the parties to the lawsuit to all businesses nationwide is appropriate under controlling law in the Fifth Circuit, which covers the Northern District of Texas, where the lawsuit is pending. Specifically, the Administrative Procedure Act authorizes a district court, like the one here, to 'postpone the effective date of an agency action.' " [Ryan LLC v. Federal Trade Commission (no. 24-0986 (N.D. Tex. Jul. 3, 2024; motion for reconsideration filed Jul. 10, 2024)]  MORE >>

"Companies must diligently work with their data security and ERISA counsel to ensure that AI tools appropriately comply with privacy, data security, and other applicable employee benefit laws, including HIPAA and ERISA, as well as newly enacted state laws regulating the use of AI technologies. AI tools should be carefully vetted for accuracy and reliability. For this purpose, an employer may want to allocate oversight responsibility to its employee benefit plan committee."  MORE >>

11 pages. "[This Guide provides information] to better identify the cyber risks in your own organization, understand what cyber insurance covers, and recognize how a comprehensive approach is the best way to protect your organization. [1] 8 Reasons to buy cyber insurance ... [2] Getting started: Cyber risk assessment ... [3] Risk transfer: What's in a good cyber policy? ... [4] Incident response: Planning for the worst-case scenario ... [5] Cyber ransomware scenario."  MORE >>

"COLI policies can help your business owner clients meet obligations from non-qualified deferred compensation (NDQC) plans -- an offering that can attract and retain employees in today's labor market.... Investing in a COLI policy can offer businesses cash flow flexibility, allowing business owners to access the cash value of the policy through loans or withdrawals to assist with liquidity needs or investments.... It can offer stability in succession planning."  MORE >>

"Generally speaking, an incentive compensation arrangement should not be referred to as a savings or retirement vehicle and it would be best if benefit distributions were made (ideally in a lump sum) exclusively to current employees rather than terminated or retirement age participants.... Alternative compliance steps may make sense depending on the specifics of your incentive compensation arrangement."  MORE >>