A coalition of 15 trade associations representing the retirement plan community, including employers and retirement services firms, is urging the U.S. Department of Labor to permit broader use of electronic communications to deliver the disclosures to retirement plan participants required by new DOL regulations.
In a letter submitted yesterday to the DOL's Employee Benefits Security Administration (EBSA), the coalition urged DOL to pursue a policy that would encourage and facilitate the use of modern electronic forms of communication.
"Electronic communication today is no longer the exception, it is the norm," the coalition wrote in its letter.
The coalition is responding to DOL's recently released interim guidance on the use of electronic media, known as Technical Release 2011-03R. A survey conducted by The SPARK Institute, Simsbury, Conn., found that the interim guidance does not provide meaningful incentives or make it more feasible for plan sponsors and their service providers to use electronic media instead of paper for the required disclosures.
"We are concerned that the guidance in the Technical Release provides little relief beyond that already available through EBSA's current safe harbor, particularly as it relates to affirmative consent and dependence on paper as the default method of delivery," says Larry Goldbrum, general counsel of The SPARK Institute, a coalition member. "Based on responses to the survey and discussions with other coalition members, it is clear that a substantial majority of service providers do not intend to make use of the Technical Release policy and the required disclosures will be delivered in paper form, rather than electronically."
Among the concerns about the interim guidance identified in the survey are the inability of existing systems to support the DOL's interim e-delivery approach without costly changes; the required affirmative action on a per participant basis for plans to use electronic communications; and the administrative impracticality of the required implementation and monitoring.