The Department of Labor (DOL) is preparing to act on a variety of issues relevant to retirement plans and participants, according to a department official who offered an outline at a June 5 session of the SPARK national conference held in Falls Church, VA.
Jeanne Klinefelter Wilson, Deputy Assistant Secretary for Policy at the Department of Labor’s Employee Benefits Security Administration, discussed actions EBSA is considering and preparing to take on a variety of “hot” issues relevant to plans, administration and participants.
Modernizing Participant Communications
EBSA’s efforts regarding improving retirement plan disclosures are “a work in progress,” said Wilson. She said that in response to President Trump’s Aug. 31, 2018 executive order, “we’re looking at ways to improve and simplify disclosure,” including broader use of electronic distribution. “The DOL is taking a hard look at electronic disclosure and technological developments” that have taken place since the department last issued guidance in that area, she said.
“Americans must be able to access high-quality investment advice,” said Wilson, telling attendees that the DOL plans to release a proposal by the end of the year. “Keep your eye out for a potential proposal,” she advised.
Wilson noted that the Trump administration is committed to deregulation, and that part of that is making regulations from different agencies align – including a fiduciary standard. “The public deserves clarity and consistency from the government,” she said. She noted that the Securities and Exchange Commissioners were set to vote on an SEC proposal concerning fiduciaries that morning. “Our goal is to proceed on a broad, aligned framework,” Wilson remarked.
Addressing the problem of missing participants “is very much on our radar screen,” said Wilson. The point of the effort to find missing participants, she explained, is to ensure that participants receive the benefits to which they are entitled. “Plan fiduciaries should pay attention to red flags regarding missing participants,” she said, such as large number of vested participants not claiming benefits, many uncashed checks and a high volume of returned mail.
“Plan sponsors play a critical role as well,” she said, particularly when employees leave and when there is a corporate takeover or acquisition. “At that time, it is very important for plan sponsors to have adequate procedures in place,” she said.
Student Loan Debt
“We’re interested in this too,” Wilson said of student loan debt and its effects, noting that “for those with student loan debt, saving for retirement may seem beyond their reach.” She noted that the DOL has prepared and makes available materials and information that encourages those with such debt to make saving for retirement a priority despite their debt.