By Greg Daugherty and Rich Helmreich on Employers who sponsor 401(k) plans and other defined contribution plans in which participants may direct the investments of their accounts now have a deadline to provide lifetime income illustrations in those plans’ benefit statements. The Department of Labor (DOL) recently published guidance addressing these requirements. While helpful, the guidance is still subject to change in … Continue Reading
By Greg Daugherty and Rich Helmreich on Much of the employee benefits news this year has related to the Coronavirus Aid, Relief, and Economic Security (CARES) Act, particularly with respect to the greater flexibility it provided 401(k) plan participants with respect to requesting in-service distributions and loans. That is not a surprise during this year of economic upheaval. Updating plan administrative procedures … Continue Reading
By Porter Wright on During the most recent recession (some might say a mini depression), many employers requested greater flexibility to reduce or suspend safe harbor non-elective contributions to their 401(k) plans. They felt that a temporary reduction or suspension of contributions would be a better alternative than outright terminating their plans. Although the applicable regulations contained procedures for reducing or suspending safe harbor matching contributions, it wasn’t until Treasury issued proposed regulations on May 18, 2009, that a procedure was available to reduce or suspend safe harbor non-elective contributions. Recently, Treasury issued final regulations that revise the requirements for permitted mid-year reductions or suspensions of safe harbor non-elective contributions. Somewhat surprisingly, the final regulations also modified the procedures for mid-year reductions or suspensions of safe harbor matching contributions to 401(k) plans. They also suggested that some relief may be on the way with respect to other types of mid-year plan amendments.… Continue Reading
By Porter Wright on If you are the fiduciary of an ERISA plan that invested in John Hancock group variable annuity contracts, we hope you have heard that three individuals have filed a lawsuit, claiming to be representing your plan and its participants and beneficiaries. You will not be receiving service of process.… Continue Reading
By Porter Wright on The Sixth Circuit has reversed the district court's dismissal of the GM ERISA stock-drop suit, Pfeil v. State Street Bank & Trust Co., and is allowing the case to proceed. You may recall that we cautioned fiduciaries of ESOPs and 401(k) plans allowing investment in employer stock to keep an eye on this case because it could be a game-changer. And now it is.… Continue Reading
By Greg Daugherty on The Sixth Circuit recently allowed the ERISA Section 404(c) safe harbor to protect a 401(k) plan’s directed trustee from being held responsible for losses in self-directed brokerage accounts. See, Tullis v. UMB Bank, N.A. This case spotlights the importance of this safe harbor for plans that allow participant direction of investments, and the DOL’s recent … Continue Reading
