Employee Ownership Blog
Corey Rosen

Corey Rosen

Senate Unanimously Passes Two Bills to Encourage ESOPs

Members of Congress may not agree on a lot these days, but as they have for 51 years, they do unanimously agree on employee ownership. On October 10, the Senate unanimously passed two bills to promote ESOPs. The first, the Retire through Ownership Act (S. 2403), could make it easier for companies to avoid legal challenges to the valuation of shares the ESOP acquires. A parallel bill (H.R. 5169) has been introduced in the House but has not yet been acted on. The second, the Employee Ownership Representation Act of 2025 (S. 1728), would add ESOP representatives to the ERISA Advisory Council. A parallel bill has not yet been introduced in the House. Both bills will now move to the House.

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Corey Rosen

NCEO Paper Assesses ESOP Risks for Employees, Managers, and Business Owners

Employee stock ownership plans (ESOPs) have widespread support from politicians and academics and can offer significant benefits for employees, business owners, and society. But there are those who argue that there are too many risks associated with these plans. Do they put too much of employee retirement assets at risk? Does the debt that an ESOP typically takes on to finance ownership transition put employee jobs and companies at risk? Do business owners and board members face a high risk of litigation? The new NCEO paper Assessing the Risks of ESOPs for Employees, Managers, and Business Owners (PDF; also see the embedded version below) by NCEO founder Corey Rosen summarizes in detail the extensive research on each aspect of ESOP risk.

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Corey Rosen

Daniel Aronowitz Confirmed as Head of Department of Labor's EBSA

The nomination of Daniel Aronowitz to head the Employee Benefits Security Administration (EBSA) in the Department of Labor (DOL) has been confirmed by the US Senate. Aronowitz was until recently the president of Encore Fiduciary (formerly Euclid Fiduciary). The company provides fiduciary insurance, fidelity bonds, cybersecurity insurance, and fiduciary insurance consulting. He is the author of the Fiduciary Liability Insurance Handbook. The book’s only mention of ESOPs is to say that this kind of fiduciary insurance is more costly than that needed for other retirement plans.

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Corey Rosen

House Committee Unanimously Approves Bill to Create Safe Harbor for ESOP Valuations

On September 17, the House Committee on Education and the Workforce unanimously approved H.R. 5169, the Retire through Ownership Act, sponsored by Rep. Rick Allen (R-Ga.), who is chair of the House Subcommittee on Health, Employment, Labor and Pensions (HELP). The bill was amended in committee to more closely parallel the version of the same bill that passed the Senate Committee on Health, Education, Labor and Pensions earlier this year.

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Corey Rosen

House Committee Passes Bills to Require DOL Reports on Common Interest Agreements and EBSA Investigations

The House Committee on Education and the Workforce passed H.R. 2958, the Balance the Scales Act, which would amend the Employee Retirement Income Security Act (ERISA) to require that the Department of Labor (DOL) Employee Benefits Security Administration (EBSA) submit an annual report to Congress on so-called “common interest agreements.” The issue first came to the forefront in Harrison v. Envision Management, No. 21–cv–00304–CNS–MD (D.C. Colo. Jan. 13, 2025), a case in which the plaintiff’s law firm received information from the DOL under a common interest agreement, even though the DOL was not a party to the suit. The attorneys for the defendants discovered the information-sharing only the night before an important deposition. The court ruled decisively against the DOL, and several members of Congress expressed concern about the practice.

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Corey Rosen

New ESOP Valuation Rules Could Come as Early as January 2026

The new regulatory agenda for the Department of Labor (DOL) indicates that new regulations for ESOP valuations could come as soon as January 2026. The regulations were required by Section 346 of the SECURE 2.0 Act of 2022. The release notes that “[t]o inform this action, the Department established a pre-rule outreach plan to broaden public participation and community engagement in the regulatory process. This includes meeting with a range of stakeholders (including ESOP sponsors, appraisers, labor organizations and academics) to hear about issues they believe should be addressed in the Department’s guidance. The goal of the outreach plan is to inform this regulatory action through meaningful and equitable opportunities for public input by a range of interested or affected parties, including underserved communities.”

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Corey Rosen

Promotion and Expansion of Private Employee Ownership Act Introduced in Senate

Senators Steve Daines (R-MT) and Maggie Hassan (D-NH), along with a bipartisan group of cosponsors, have introduced the Promotion and Expansion of Private Employee Ownership Act of 2025 (PDF). This is a companion bill to H.R. 3105, introduced by Representatives Mike Kelly (R-PA, chair of the House Ways and Means Committee) and Jimmy Panetta (D-CA). The bill has four components:

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