ERIC Urges DOL to Exclude Large Plans from Fee Disclosure Guides

For Immediate Release

Washington, DC – The ERISA Industry Committee (ERIC) today urged the Department of Labor (DOL) to exclude large plans from its proposal to require service providers to distribute a guide or similar tool to fiduciaries in order to satisfy the disclosure regulations under section 408(b)(2) of the Employee Retirement Income Security Act.  

The DOL in March 2014 proposed to collect information in order to explore the current practices and effects of the 408(b)(2) regulations and evaluate the need for a guide to help plan fiduciaries understand the information being disclosed to them.   The DOL indicates that it is planning to conduct focus groups on small retirement plans. 

ERIC’s letter expresses concern that the DOL’s focus on small plans may cause it to assume that similar issues exist for large plans.  “While ERIC supports the efforts of the DOL to analyze the impact of the 408(b)(2) regulations on small and mid-sized plans, we urge the DOL to recognize the differences between small and large plans, and ultimately exclude large plans from any amendment to the 408(b)(2) regulations that would require service providers to distribute a guide, summary or similar tool to fiduciaries,” said Kathryn Ricard, ERIC’s Senior Vice President for Retirement Policy. 

The letter explains that fiduciaries of large plans can use the multitude of resources available to them to analyze their plans’ arrangements with their service providers, and typically have relationships with their service providers that enable them to get clarification and additional details, as needed. 

Ricard adds that, “Fiduciaries of plans sponsored by America’s largest employers generally have a team of sophisticated professionals and access to independent expert advice to help them analyze plan fees. Smaller plan sponsors typically have limited resources to expend analyzing plan fees and less information readily at their disposal.” 

ERIC urges the DOL to recognize the differences between large and small plans and cautions that a guide or summary would result in additional costs to service providers that will likely be passed through to the plan and, in many cases, to the plan’s participants, ultimately harming the plan participants the DOL seeks to protect. 

The letter concludes by requesting that large employer plans be included in planned focus group discussions if the DOL is so inclined to apply the guide requirement to large employer plans.  

The letter can be accessed by clicking on the link below. 

ERIC Comment Letter to DOL

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

Kelly Broadway, 202.627.1918, kbroadway@eric.org

About the ERISA Industry Committee
ERIC helps America’s largest employers stay ahead of employee benefit policy. ERIC member companies are leaders in every sector of the economy, and we represent them in their capacity as sponsors of employee benefit plans for their own workforce. Only ERIC provides the combination of intel, expertise, collaboration, and lobbying that exclusively serves the interests of large employers who provide health, retirement, and compensation benefits to their nationwide workforce.