DOL Issues Proposed Ruling on Electronic ERISA Notifications
On October 22, 2019, the Department of Labor issued proposed new rules on filing electronic notices. The liberalized rule allows employers to use electronic notifications as the default method of delivery for plans governed by ERISA. The new rules also, however, allow employees to opt out of electronic notifications, in which case they would continue to receive paper notifications.
Current requirements allow for "hand delivery, first-class mail or electronic delivery under a 2002 safe harbor for participants who have access to electronic media at work, or participants who affirmatively consent to receive electronic documentation," according to an October 30 brief by McDermott Will and Emery.
The DOL released a Fact Sheet on the proposed rules that describes the safe harbor as follows:
- Plan participants would be notified that information is available online, including:
- Instructions for how to access the information.
- The right to paper copies of information.
- The proposal includes additional protections for retirement savers:
- Standards for the website where disclosures will be posted and
- System checks for invalid electronic addresses.
- When the conditions of the safe harbor are met, plan administrators may furnish documents electronically unless participants affirmatively opt out.
The DOL says that the proposed rule change is intended "to reduce printing and mail expenses for job creators and make disclosures more readily accessible and useful for America’s workers," and suggests that the change could save American businesses $2.4 billion over 10 years.
Comments on the proposed rule are welcome until November 22. Go to www.regulations.gov and refer to regulatory identifier number (RIN) 1210-AB90.