Welcome
Benefits & Executive Compensation News

Labor Dept. Focusing on Guidance for Locating Pensioners

July 19, 2018, 3:30 PM

The Labor Department’s benefits regulator is working on guidance for employers who have lost contact with retirement plan participants, head of the Employee Benefits Security Administration Preston Rutledge said today in a rare public appearance.

The announcement comes after the business community and the Government Accountability Office called for the DOL to release specific guidelines they need to follow to ensure they’re in compliance when contacting plan participants. Rutledge, who just hit his six-month mark as head of the EBSA this week, focused solely on the missing participant issue as he addressed a crowd of dozens July 19 at an event focused on retirement at the U.S. Chamber of Commerce.

The retirement issues such as getting people to save and auto-enrollment are important, Rutledge said, “but in the end the distribution phase is critical.”

The missing participant issue centers on what an employer’s fiduciary duty is when it comes to contacting participants of their retirement plans to give them their benefits. While there are documents and related government programs that employers can reference to guide their efforts, specific guidance doesn’t currently exist for employers trying to contact participants of existing retirement plans.

EBSA will work with businesses and trade groups going forward to develop best practices, Rutledge said. He didn’t give an estimate for when the guidance might be released.

Since being confirmed last year, Rutledge led the Labor Department’s first major rule-making under President Donald Trump, which gave more small businesses access to a health insurance option known as an association health plan. The rule, published in June, changed the definition of “employer” to allow more employers, such as self-employed individuals and independent contractors, to band together and purchase health insurance as a large group.

His leadership in the enforcement of the rule will be instrumental going forward, as the responsibility of regulating the new association health plans lies with the states and the DOL.

Rutledge could also be instrumental as a retirement legislation he had a hand in drafting heats up in Congress. As an aide to Sen. Orrin Hatch (R-Utah) and senior tax and benefits counsel on the Senate Finance Committee, Rutledge helped draft a 2016 version of a bipartisan retirement bill that was reintroduced in both chambers this year. The bill, known as the Retirement Enhancement and Savings Act, is currently stalled in House and Senate committees but could get a second wind as part of the House “Tax Reform 2.0" effort.

Rep. Kevin Brady (R-Texas) July 18 said RESA may be included in his tax reform proposal that he plans to release next week.

To contact the reporter on this story: Madison Alder in Washington at malder@bloomberglaw.com

To contact the editors responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com

To read more articles log in. To learn more about a subscription click here.