As we described in our August 31, 2020 LawFlash, the US Department of Labor (DOL) issued an Interim Final Rule (Rule) on August 18, 2020 outlining the requirement of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) for employers to provide “lifetime income illustrations” to defined contribution plan (e.g. 401(k), 403(b), etc.) participants. The purpose of the Rule is to provide participants with disclosures that will help them understand how their defined contribution plan accounts may translate into an income stream in retirement.
ML BeneBits
EXAMINING A RANGE OF EMPLOYEE BENEFITS
AND EXECUTIVE COMPENSATION ISSUES
AND EXECUTIVE COMPENSATION ISSUES
The US Department of Labor (DOL) issued Information Letter 06-14-2021 last month to the attorney of a plan participant who requested a copy of an audio recording and transcript of a phone conversation he or she had with the plan’s insurer. The participant was requesting this information in relation to the participant’s denied claim under the plan.
The IRS issued Notice 2021-40 (the Notice) on June 24 that provides a 12-month extension (until June 30, 2022) of the temporary relief from the requirement that certain retirement plan elections be witnessed – in person – by a plan representative or a notary public. The IRS originally issued this temporary relief in the early days of the COVID-19 pandemic lockdown with such relief extending through the end of 2020. The IRS then extended the temporary relief through June 30, 2021. The Notice again extends this temporary relief through June 30, 2022.
We repeatedly warned over the past few months (here, here, and here), that officials at the highest levels of the DOL were signaling that the DOL would begin an audit initiative focusing on retirement plan cybersecurity practices. Despite plan fiduciaries having had just a handful of weeks to digest the DOL’s only actionable guidance on cybersecurity and privacy matters, the wait is over. We can confirm that the DOL has begun issuing information and document requests under this new initiative, and the requests are probing and indicate serious inquiry by the DOL.