Week ending August 3rd, 2018 For retirement plan sponsors wanting knowledge and tips about the design and administration of their plans, court opinions often offer details. For those fearing participant lawsuits when contemplating a plan design change, it is helpful to know what constitutes a settlor decision versus what constitutes a fiduciary decision. Plan sponsors often do what they think is right even with a lack of regulator guidance or lack of engagement from participants. Most are doing the best they can to provide a plan design that is most helpful to participants and to stay in compliance with rules, laws and regulations when administering their plans. This edition of PLANSPONSOR Weekend focuses on plan design and administration.
Editor's choice Compliance NYU Claims Victory in 403(b) Plans Lawsuit In the first university 403(b) plans case to go to trial, a federal judge includes in her opinion all prudent processes the plan sponsor engaged in when considering providers, fees and investments.Read more > Compliance Independent Contractors’ ERISA Lawsuit Fails to State Actionable Claim The dispositive question is not whether the claimants were employees but whether, considering them as employees, they were eligible to participate in an ERISA plan according to the specific terms of the plan under consideration.Read more > Compliance Plan Sponsors Shouldn’t Fear Making Settlor Decisions Retirement plan sponsors often fear participant backlash when making decisions that could actually help improve participant outcomes, but the law is on their side, as plan amendments are considered settlor functions.Read more > Administration Missing Inaction What are the rules for locating missing retirement plan participants and what should plan sponsors do when they’re found?Read more > Data and Research Simpler Retirement Plan Communications Make No Difference in Employee Decisions In conclusion, an IZA Institute of Labor Economics study found, “the data do not support the idea that presenting optional 401(k) plan information in a simpler, more compact way will improve employees’ retirement planning choices. However, we did find that financial literacy was positively associated with better choices.”Read more > Compliance Hardship Withdrawal Safe Harbor Covers Tuition, But Not Loan Repayments Plans which permit non-safe harbor hardship distributions could theoretically approve a participant’s hardship distribution request for the repayment of student loans, but those relying on the safe harbor cannot.Read more >
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