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Employee Benefit Developments and Year-End Considerations

"[R]egulators have been busy issuing much-needed guidance ... relating to [1] implementing penalty-free withdrawals for emergency personal expenses and domestic abuse distributions, [2] the RMD rules, and [3] implementing the long-term, part-time employee (LTPT) rules, among others.... Health and welfare plans have seen a significant uptick in the amount of new guidance compared with a typical year.... [A] number of lawsuits filed against retirement plan sponsors alleging violations of fiduciary duties with respect to the use of retirement plan forfeitures.... As with retirement plans, health and welfare plans are subject to fiduciary duties under ERISA."

Employee Benefit Plan Amendments and Disclosures Required This Year

"[P]lan sponsors must amend their retirement plan documents before the end of the 2022 plan year.... [The SECURE Act and the CARES Act] require plan amendments to reflect [1] certain mandatory changes and/or [2] optional changes employers chose to implement.... [S]ponsors of health and welfare plans should make sure that their plan documents are fully up-to-date with all the various changes required by (and/or due to) the myriad laws enacted and guidance issued throughout the COVID pandemic. This includes several changes in the CARES Act and informal guidance from the IRS, including, among other things, the temporary rules requiring plans to disregard certain days in calculating various COBRA, special enrollment and ERISA claims/appeals deadlines, etc."

Supreme Court Ruling May Cause More Fiduciary Lawsuits

"[M]any plan fiduciaries simply add 'ESGs' to investment lineups and assume it is prudent because there are other funds in the same investment category that clearly meet the prudent selection requirements. This Supreme Court decision states clearly that all funds, including ESGs, must stand on their own as prudent investment options." [Hughes v. Northwestern Univ., No. 19-1401 (S. Ct. Jan. 24, 2022)]

Early 2022 To-Do: Employer Fiduciary Responsibilities for Health and Welfare Plans

"New rules apply to health plan service provider compensation in 2022 that employers must know and be equipped to manage. This e-alert provides employers with background on these new rules, describes the new rules from the employer's perspective and suggests an employer action plan for 2022."

CARES Act Plan Loans, Plan Distributions and Other Relief: Plan Sponsor Considerations Before Implementation

"We are witnessing a rush to provide [CARES Act loan and distribution] options to affected plan participants and this rush is resulting in problems ... [1] Plan sponsors are being given a very brief time to respond to [TPAs] with decisions (e.g., five days) and told by the TPAs that the plan will be defaulted into some but not all of the flexibility allowed by these new rules.... Plan sponsors are [thus] allowing decisions of great magnitude to be made by their vendors. [2] Communications to participants are being proposed, and then quickly distributed to participants, that do not correctly describe the new rules or the decisions desired by the plan sponsors. [3] Spousal consent requirements under the current terms of the plan are being disregarded as provisions that can be ignored now and amended out of the plan later."

Assessing the New Maryland Paid Sick Leave Law

"Employers with 15 or more employees will be required to provide employees with paid leave ... and employers with fewer than 15 employees will be required to provide unpaid leave ... for the following reasons: [1] Care or treatment of the employee's or a family member's mental or physical illness, injury, or conditions; [2] Preventive medical care for the employee or family member; [3] Maternity or paternity leave; and [4] Absences that are necessary due to domestic violence, sexual assault, or stalking committed against the employee or the employee's family member."

New Tax Law: Additional Details

"Taxability of moving expense reimbursements.... Qualified transportation fringe benefit changes.... Bicycle commuter benefits changes."