The rule announced Thursday by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA), formally implements authority contained in the Pension Protection Act (PPA), according to a news release.
“The new right to diversify is an important step in improving retirement security,” said Bradford P. Campbell, assistant DoL secretary in the announcement. “This rule enforces that right by penalizing plan officials who fail to give workers the required notice.”
According to the announcement, the PPA gives participants and beneficiaries the right to sell their company stock shares and reinvest the proceeds in other plan investment options. The law also included a mandate that plan administrators notify participants and beneficiaries of the new right and of the importance of diversifying the investment of retirement account assets.
This regulation will be published in the Federal Register on Friday.
The public may submit comments to the DoL via e-mail to e-ORI@dol.gov or through the federal e-rulemaking portal at http://www.regulations.gov/ . Paper-based comments should be sent to the Office of Regulations and Interpretations, Employee Benefits Security Administration, Room N-5669, U.S. Department of Labor, 200 Constitution Ave., N.W., Washington, D.C. 20210, Attention: 502(c)(7) Civil Penalty.