ML BeneBits

There has been an increasing focus in recent years on the intersection of ERISA’s fiduciary duties and the issues of cybersecurity and data (including participant data) protection. Beyond the potential for pecuniary and reputational harm due to a breach, this interest has been driven by an increasing number of lawsuits in which plaintiffs allege that a plan fiduciary and/or service provider breached ERISA by failing to protect against a cybersecurity attack or data breach. 

Reversing a lower court’s decision, the US Court of Appeals for the Second Circuit issued an opinion in Cooper v. DST Systems, Inc., et al., finding that an arbitration agreement signed by an employee as part of his employment did not require that he arbitrate any fiduciary breach claims challenging the investment options and fees in his employer’s 401(k) plan. Read our recent LawFlash to learn more about the decision and the potential implications.

In a somewhat expected development, the US Department of Labor’s Employee Benefits Security Administration (EBSA) issued an enforcement statement on Wednesday announcing that it will not enforce the recently published final rules on “Financial Factors in Selecting Plan Investments”—commonly known as the ESG Rule—and “Fiduciary Duties Regarding Proxy Voting and Shareholder Rights” (Proxy Voting Rule).

The US Senate on March 6 passed the Butch Lewis Emergency Pension Plan Relief Act of 2021 (EPPRA) as part of the American Rescue Plan of 2021 (H.R. 1319), the Biden administration’s $1.9 trillion COVID-19 stimulus package.

Join Morgan Lewis this month for these programs on employee benefits and executive compensation.

At the 11th hour, the US Department of Labor’s Employee Benefits Security Administration (EBSA), with coordination and review by the Internal Revenue Service and the Department of Health and Human Services (collectively, the Agencies), finally issued guidance on the suspension of certain deadlines under the Employee Retirement Income Securities Act of 1974, as amended (ERISA) and the Internal Revenue Code of 1986, as amended (Code). As we described in our February 25, 2021 blog post, the Agencies previously issued EBSA Disaster Relief Notice 2020-01 and a joint final rule (collectively, Guidance) suspending timeframes for special enrollment elections, claims and appeals filing deadlines, and COBRA notice, election, and premium payment deadlines.

As we described in our LawFlash from last spring, the US Department of Labor’s Employee Benefits Security Administration (EBSA) and the Internal Revenue Service (IRS) (collectively, the Agencies) issued EBSA Notice 2020-01 and a joint final rule (collectively, Guidance) suspending certain deadlines under the Employee Retirement Income Securities Act of 1974, as amended (ERISA) and the Internal Revenue Code of 1986, as amended (Code).

Join Morgan Lewis this month for these programs on employee benefits and executive compensation.

Join Morgan Lewis for the first semester of the 2021 Global Public Company Academy, launching on February 10.

For the 2020 tax year, the Internal Revenue Service (IRS) moved reporting of certain nonemployee compensation, including current and deferred compensation paid to independent contractors and corporate directors, from Form 1099-MISC to revived Form 1099-NEC (see our previous LawFlash). However, according to IRS Publication 1220, released on October 20, 2020,