As the end of the calendar year approaches, sponsors of qualified retirement plans should consider whether their plan documents require updates to comply with important legal changes and deadlines. Below is a summary of some key legal developments that may impact your plan:
In an article published by Managed Healthcare Executive, I discussed the potential impact of a recently proposed regulation from the U.S. Departments of the Treasury, Health and Human Services and Labor that expands the usability of health reimbursement arrangements (HRA). The new rule as proposed would apply for most health plans beginning January 1, 2020, and would be particularly beneficial to employees of small employers who are not required to offer health plan coverage to their full-time employees under the ACA. Continue Reading Looser Restrictions on HRAs on the Horizon
In a Law360 article, I provided insight on the Department of Labor’s (DOL) proposed regulations on retirement plans that would make it easier for companies to join existing retirement plans or join forces to generate new ones – which has the potential to broaden the availability of workplace retirement plans to allowing small businesses. Under the proposed regulations, “a group of unrelated employers could now have a single ERISA plan,” I explained.
We recognize that many of our clients sponsor ERISA welfare benefit plans and are currently undergoing their open enrollment process and issuing related participant communications. To assist our clients with that process, we have prepared an Automatic Participant Disclosures Checklist for use during open enrollment and throughout the plan year.
If you have questions regarding the information in this checklist, please contact any of the attorneys in our Employee Benefits Practice Group.
On August 31, 2018, President Trump signed an executive order authorizing the U.S. Department of Labor (DOL) and the U.S. Department of the Treasury to evaluate expanding access to 401(k) retirement plans. The order is designed to cut some of the administrative burdens and costs that prevent smaller employers from offering 401(k) plans to their employees. The Trump administration noted that in 2017, roughly 89 percent of larger employers offered retirement plans compared to only 53 percent of small employers (those with fewer than 100 employees).
The executive order directs the agencies to consider two main issues:
- Expanding the criteria for multiple-employer plans (MEPs), under which employees of different private-sector employers may participate in a single retirement plan; and
- Raising the age when individuals with traditional Individual Retirement Accounts (IRAs) and 401(k)s must start making required minimum distributions, which is currently age 70 ½.
In an article published in the Nashville Business Journal’s Largest Employers special report on July 6, 2018, I provided a column highlighting three important questions for employers to ask as they strive to reduce harassment in the workplace and cultivate a healthy workplace environment. The effectiveness of an anti-harassment policy often comes down to employee perception of how the policy is enforced, trained and embraced by leadership, so it is important that employers are mindful of the answers to these questions:
I outlined the key considerations, important steps and issues of concern when buying a company that is employee-owned, or at least partially employee-owned, by an Employee Stock Ownership Plan (ESOP), including:
- The nature of an ESOP: In an ESOP, employees have retirement accounts invested primarily in their employer’s stock, rather than having accounts invested in an array of securities and mutual funds. The trustee of the ESOP – who represents ESOP participants as the beneficial owners of the company stock – is entitled to participate in the sale or transaction like other shareholders would. Most importantly, anytime an ESOP is involved in the acquisition or sale of company stock, the transaction must be for “adequate consideration,” and the trustee’s decision to buy or sell must be in the financial best interest of the ESOP participants.
Continue Reading Key Considerations When Buying a Company with an ESOP
In January 2018, the U.S. Department of Labor (DOL) announced that final regulations affecting how some ERISA plans process claims and appeals will apply beginning April 1, 2018. As explained below, the final regulations require that plans, plan fiduciaries, and insurance providers comply with additional procedural requirements when deciding claims involving disability determinations, which can impact a variety of different types of plans, including pension and non-qualified plans. The final regulations were initially released in December 2016, but had been delayed several times.
Bass, Berry & Sims attorney Doug Dahl provides an update regarding the Department of Labor’s (DOL) fiduciary rule, which sets forth when an individual becomes a fiduciary by providing investment advice to employer retirement plans. While the final rule was released in April 2016, numerous delays have postponed entire implementation until July 2019. Until then, Doug recommends employers consider the following:
Bass, Berry & Sims attorney Susie Bilbro authored an article for BenefitsPRO discussing the future of genetic testing in employee wellness programs following the latest updates from the Preserving Employee Wellness Programs Act, introduced in the House of Representatives (H.R. 1313) in March 2017. The bill would allow employers to ask employee’s family medical history and request genetic information as part of wellness programs. While the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA) do not typically allow employers to obtain employee information regarding health conditions or those of family members, both laws allow employers to inquire about this information and conduct medical examinations if providing health or genetic services through a voluntary wellness program.