Retirement benefits have entered the digital age — thanks to a new ruling by the Department of Labor allowing private-sector employers to share more plan information online to retirement participants.
The ruling, announced Thursday, May 21st, gives employees the option to choose whether they want to receive plan information online or through the mail. DOL representatives say the ruling was passed to help HR professionals and retirement plan providers effectively distribute plan information during the coronavirus crisis. The final rule, will be effective 60 days following the May 21 publication in the Federal Register.
“This commonsense rule reflects today’s marketplace while retaining the ability of participants to choose how they receive their retirement information,” said Preston Rutledge, assistant secretary of the Employee Benefits Security Administration in the DOL announcement.
Employers will be able to distribute retirement benefit information at a reduced cost under the new law. By delivering this information electronically, the DOL estimates employers will collectively save $3.2 billion in printing and delivery costs over the next decade. However, employers who prefer to receive their retirement information through the mail can still elect to do so.
The new rule addresses deregulatory efforts that can save “billions of dollars,” said U.S. Secretary of Labor Eugene Scalia in the department’s announcement. “The rule will rely on widely available technology to keep workers and retirees informed about their plans, while still preserving the option to receive retirement information by mail.”
Under the new rule, retirement plan administrators are required to notify participants that communications can be done electronically, and provide information on how to access the correspondence.
The DOL is confident that the new ruling will help deal with the challenges brought on by social distancing.
“As we look ahead to reinvigorating the American economy, the Department of Labor’s priorities include eliminating unnecessary burdens for employers that sponsor retirement plans and on addressing the needs of wage earners, job seekers, and retirees,” Scalia said.
Toppan Merrill is here to help. We have over 50 years of experience in digital and print communications for retirement plans. Contact us today to learn how we can help with your digital communications needs for plan participants.
Additional information: Fact Sheet: Retirement Plans Electronic Disclosure Safe Harbor Rule