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December 26, 2006 at 02:11 PM
The Employee Benefits Security Administration has released guidance for employers that will have to comply with new retirement plan notice laws.
EBSA, an arm of the U.S. Department of Labor, issued the guidance in Field Assistance Bulletin 2006-03 to tide employers while employers are waiting for the department to issue final regulations implementing the notice laws, which were created by the Pension Protection Act of 2006 and are set to take effect for plan years beginning after Dec. 31.
The PPA notice provision, implemented as Section 105 of the Employee Retirement Income Security Act, requires employers to provide benefit statements at least once each quarter for participant-directed 401(k) plans and similar plans, at least once each year for professionally directed 401(k) plans, and at least once every 3 years for defined benefit plans.
The guidance gives plan administrators a chance to show that they have acted in good faith in efforts to comply with ERISA Section 105.
At least in the beginning, administrators can provide the necessary information about vesting, account performance and other matters through the Web, and by providing several different documents, but the administrator must tell participants how they can get free paper statements.
