In an article published in the Nashville Business Journal’s Largest Employers special report on July 6, 2018, Tim Garrett 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:
Bass, Berry & Sims attorney Doug Dahl 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.
In an article published by HR Professionals, Bass, Berry & Sims attorney Susie Bilbro provided insight on aspects plan sponsors should consider as they prepare for the 2018 open enrollment process. Among the key questions Susie suggests sponsors to ask themselves in the upcoming months are:
On June 22, 2017, Senate Republicans released a draft of the Better Care Reconciliation Act (BCRA), their much-anticipated version of the legislation to “repeal and replace” the Affordable Care Act (ACA). Despite rumors of a re-write of the American Health Care Act that passed in the House of Representatives by a narrow vote on May 4, the BCRA largely mirrors the structure and certain key measures of the House version (see our previous alert dated May 5, 2017). On the other hand, the BCRA has already been criticized by the more vocal opponents of the ACA in the Senate for not going far enough to eliminate measures established under the ACA. The Senate could vote on the BCRA as early as next week, but given the uncertainty surrounding its success, it is likely to undergo amendments prior to then. This alert provides an overview of key provisions of the BCRA and how, as drafted, it would affect aspects of the ACA.
In an article published by Employee Benefit News, Bass, Berry & Sims attorney Doug Dahl provided guidance for employers who now must comply with the Department of Labor’s (DOL) fiduciary rule. After months of delay, the rule went into effect on Friday, June 9, 2017, and provided guidance on who is considered a fiduciary under the new rule. Doug outlined the actions that employers and other plan sponsors should consider, such as identifying whether advisors are fiduciaries or have conflicts of interest, communicating plan details and watching IRA rollovers to ensure plan providers are not recommending specific plans or investments. However, not all plans are created equal. “The smaller a plan is, the more likely [it is] that you’re going to have conflicted advice under the new rule,” said Doug. “The key is knowing who the company’s investment fiduciaries are and making sure they are complying with the responsibilities they have toward the retirement plan and its participants.”
The full article, “What Employers Should Do To Ensure Fiduciary Rule Compliance,” was published on June 11, 2017, by Employee Benefit News and is available online.
Bass, Berry & Sims attorney Doug Dahl commented on the Department of Labor’s (DOL) new fiduciary rule that will impact how and when an individual is treated as a fiduciary under ERISA if that person provides investment advice. While many expected a further delayed applicability, parts of the new rule will take effect June 9, 2017. Because of the new regulations, “some advisors may decide to exit the retirement planning sector of the financial industry or they may close up shop altogether rather than deal with lawsuits and enforcement issues,” said Doug.
In an article published by InvestmentNews, Bass, Berry & Sims attorney Doug Dahl provided insight on a recent district court ruling which allowed allegations that using multiple record-keeping firms in 403(b) retirement planning breaches fiduciary duty to continue. With many other prominent institutions involved in similar litigation, this particular lawsuit targets Emory University, and the decision to move forward could potentially impact the success of similar claims in those other cases. The plaintiffs claim that using multiple record-keeping systems burdens participants with fees because it is cost prohibitive and doesn’t adequately leverage assets to drive lower pricing. “This is a relatively new, or at least a newly successful, claim,” said Doug. While the article notes that it is still unclear whether there is anything necessarily wrong with the use of multiple service providers, Doug adds “I think the fact that the claim continued is definitely noteworthy.”
The full article, “Use of Multiple Record Keepers Could Hurt Defendants in 403(b) Lawsuits,” was published by InvestmentNews on May 19, 2017, and is available online.