The U.S. Department of Labor should act to improve disclosure of key information to 401(k) participants by requiring employers to provide them with a fee and other key investment option information, only at enrollment.
A group of 12 trade groups representing plan sponsors and financial services providers has included that recommendation in comment letter to Labor.
The groups also are suggesting that retirement plan participants should be notified annually about where they can find or how they can request fee information and other investment option information.
The recommendations were prepared in response to a Labor Department request for comment about efforts to revise to existing fee disclosure guidelines.
The signatories include representatives for groups such as the American Council of Life Insurers, Washington; the American Bankers Association, Washington; American Benefits Council, Washington; the Investment Company Institute, Washington; the National Association of Manufacturers, Washington; and the U.S. Chamber of Commerce, Washington.
The trade groups are urging the Labor Department “to avoid the temptation to overload participants with detailed and voluminous information that can impair sound decision-making.”
“Any new disclosure regime must recognize that plan sponsors and plan participants have markedly different disclosure needs,” the trade groups write.