ERIC’s Letter to Sec. Acosta Asking to Protect Emoployer-Sponsored Retirement Plans

May 3, 2017

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The Honorable R. Alexander Acosta
Secretary, U.S. Department of Labor
200 Constitution Avenue NW
Washington, DC 20210

Dear Secretary Acosta:

The ERISA Industry Committee (“ERIC”) writes to share our concerns about potential state activity that interferes with the ability of employers to provide voluntary retirement benefits under the Employee Retirement Income Security Act of 1974 (“ERISA”), and urges your support to protect plan sponsors and the retirement security of millions of Americans.

ERIC is the only national association that advocates exclusively for large employers on health, retirement, and compensation public policies at the federal, state, and local levels. ERIC’s members provide comprehensive retirement benefits to tens of millions of active and retired workers and their families across the country. ERIC has a strong interest in policies that would impact its members’ ability to provide cost-effective retirement programs or would impose state-by-state requirements on employers sponsoring benefit plans.

Today, the U.S. Senate followed the House of Representatives and passed Joint Resolution 66 under the Congressional Review Act. This action effectively repealed the Department of Labor’s rule on state-run auto-IRA programs, which allowed states to create such programs. We encourage President Trump to sign this resolution. However, even if the President signs the resolution, ERIC remains concerned that states will continue to implement their own programs that violate the preemption clauses of ERISA and impose recordkeeping and other compliance burdens on employers.

If states continue implementing their own mandatory auto-IRA programs, ERIC requests that the Department of Labor use any and all enforcement actions at its disposal to protect plan sponsors—that already provide an ERISA-qualified retirement plan to employees—from burdensome compliance activities that states may impose. Currently, Oregon is the only state to publish finalized rules for a state-run retirement program. As the first and only state, Oregon has set a precedent for other states to unnecessarily and improperly burden large employers. Oregon’s finalized rules, for example, will require large employers to compile and report information requested by the state every three years to apply for an exemption from the state mandate. ERIC and its members support efforts to promote retirement savings, but oppose any additional compliance activities that only serve to deter employers from offering a quality retirement plan. We urge the Department of Labor to support the preemption clauses of ERISA and ensure that states do not infringe on employers already providing a quality retirement plan to their employees.

We look forward to working with you and your Department on this and other policies impacting employee benefits. If you have any questions concerning this letter, or if we can be of further assistance, please contact Will Hansen at whansen@eric.org or 202-789-1400.

Sincerely,

Will Hansen
Senior Vice President, Retirement & Compensation Policy