Additional Guidance on Brokerage Windows Could Drive Participants out of Employer-Sponsored Retirement Plans

ERIC provides testimony to the U.S. Department of Labor Advisory Council on Employee Welfare and Pension Benefit Plans

Washington, DC – The ERISA Industry Committee (ERIC) is testifying before the U.S. Department of Labor Advisory Council on Employee Welfare and Pension Benefit Plans on brokerage windows during the Council’s meeting today and tomorrow.

On Friday, June 25, ERIC’s Aliya Robinson, Senior Vice President of Retirement and Compensation Policy, will be the only witness to solely represent large plan sponsors at the meeting. Robinson will tell the Council that large employers are confident in their abilities to include the brokerage window as an option under the current guidance provided under ERISA and do not need any further guidance on the issue.

“ERIC believes that comprehensive guidance issued under ERISA and by the Department of Labor already protects participants in large retirement plans that include brokerage windows. Therefore, any additional protections for participants are unnecessary and would be redundant,” said Robinson.

A survey of ERIC member companies, all of whom offer ERISA plans, found that over half of the respondents offer brokerage windows in their 401(k) plans; most (75%) include the brokerage window to expand available investment options under the plan.  Moreover, respondents that offer brokerage windows make clear disclosures to plan participants that the brokerage window is not subject to the fiduciary protections of other in-plan investment options that the liability of the investments falls entirely on the participant.

The fiduciaries of these large plans already select and monitor their plans’ designated investment alternatives and spend significant time and resources to determine appropriate investment options for participants. Any guidance from the DOL that would impose fiduciary obligations over specific brokerage window investments would be unmanageable. It could even put fiduciaries in the position of evaluating thousands of investments and their appropriateness to the investing plan participant and the plan. Placing these burdens and risks on fiduciaries could result in plans dropping brokerage windows, causing participants who rely on them to abandon the employer retirement system in favor of IRAs or even non-retirement funds.

“Plan sponsors understand that each employee will have a different level of comfort and available resources when it comes to investing, which is why some plans include brokerage windows. It is important for plan sponsors to continue to provide brokerage windows as an investment option without placing additional requirements on plan fiduciaries or driving participants away,” said Robinson.

Click here to read ERIC’s testimony and review the findings of ERIC’s member company survey on brokerage windows.


All media inquiries to The ERISA Industry Committee should be directed to:

Kelly Broadway, 202.627.1918,

About The ERISA Industry Committee
ERIC is a national advocacy organization that exclusively represents large employers that provide health, retirement, paid leave, and other benefits to their nationwide workforces. With member companies that are leaders in every sector of the economy, ERIC advocates on the federal, state, and local levels for policies that promote flexibility and uniformity in the administration of their employee benefit plans.