Tuesday, August 4, 2020
On May 27, 2020 the Department of Labor (DOL) released final safe harbor regulations in regard to using electronic delivery as a default process for distributing materials to plan participants and beneficiaries. These regulations apply to qualified retirement plans only and not welfare/health plans. The rules are in addition to current regulations and provide additional options for furnishing covered documents. The covered documents are any documents required by ERISA Title I, including Summary Plan Descriptions, Summary of Material Modifications, Summary Annual Reports, Participant Fee Disclosures, Automatic Enrollment Notices plus others.
The final regulations become effective July 27, 2020, however they may be used before that date. There is also a transition rule allowing reliance on the old electronic delivery rules of quarterly participant statements for 18 months after the effective date of these new regulations
Summary of Final Regulations (“CRDs”)
Generally, the new regulations require an initial paper notice which notifies the individual participant that future covered notices are to be emailed or posted to a website. An email address or mobile phone number provided by the participant or an employer provided email address to be used for the electronic notices must be included in the initial paper notice and the individual has a right to opt out of the future electronic delivery and receive paper copies.
Then a Notice of Internet Availability (NOIA) must be sent by email or text notifying the individual which notice(s) are being posted. The text or email should contain a website address, or a link to that posting, or the notice(s) can be attached directly to the NOIA email. The NOIA must contain several items with specific information. The delivery of the NOIA must be monitored and steps taken to ensure the delivery of the NOIA is received.
Please contact Administrative Retirement Services, Inc. If you want to discuss any of the information presented in this new regulation.
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