Earlier today, the DOL issued guidance on missing and non-responsive participants. As you know, ERIC has been working with the agency for several years to encourage them to provide some guidelines that employers can use specifically during the audit process. The guidance comes in three parts:
- Best Practices for Pension Plans. While we have concerns about best practices becoming de facto requirements, it is helpful to see the policies and operations that the agency views as successful. We will have to continue to stress the importance of individual circumstances and that this process cannot be one size fits all.
- Compliance Assistance Release 2021-01. This guidance is a direct outcome of our conversations with the agency and stressing the importance of needed transparency in the agency’s enforcement efforts. In addition, we hope that this will lead to a uniform enforcement standard between different regions.
- Field Assistance Bulletin 2021-01. The DOL is temporarily halting enforcement efforts of fiduciary violations related to transferring a missing or non-responsive participant’s account to the PBGC under the PBGC’s missing participant program if the fiduciary acts in good faith. This temporary non-enforcement does not extend to fiduciary violations related to a failure to diligently search for such participants or beneficiaries prior to the transfer.
We are still reviewing the guidance and will provide further feedback to the DOL as needed. Since this guidance is sub-regulatory, it will not be impacted by President-elect Biden’s expected memo on midnight regulations. On the other hand, the new Administration can make to this guidance at any time without notice and comment. To review the guidance and your feedback, we will hold a webinar in the next couple of weeks – please stay posted for further information.