The confirmation of Assistant Attorney General Tom Perez as secretary for the Department of Labor on Thursday will not hinder the DOL’s release of its fiduciary reproposal, which the Department says will come in October.
The Senate confirmed Perez by a vote of 54-46, making him the only Latino in President Barack Obama’s cabinet.
Despite recent attempts by lawmakers — and those in the industry — to stymie the DOL’s re-release of its fiduciary rule, the DOL’s Employee Benefits Security Administration’s Semiannual Regulatory Agenda, released July 3, states that a reproposal to amend the definition of fiduciary under the Employee Retirement Income Security Act (ERISA) will come in October.
Fred Reish, partner and chairman of the financial services ERISA team at Drinker Biddle & Reath, says the DOL’s controversial fiduciary plan could become a “point of contention” in letters from lawmakers or any potential upcoming hearings that Congress may have with Perez. But DOL’s fiduciary “train has left the station.”
Reish expects the DOL’s fiduciary redraft to be at the Office of Management and Budget in the next few weeks.
The next step will be “to see the proposed regulation and the related proposed prohibited transaction exemptions,” Reish says. “If the DOL has responded to the most important concerns of the private sector, then the reproposal could be less controversial than contemplated.”
Robert Lewis, vice president of legislative affairs for the Financial Services Institute, agrees that Perez’s confirmation will not change DOL’s fiduciary course. “DOL has been moving forward [on its fiduciary plan] most of the year with an acting secretary,” he says. “We do not expect anything to change with the confirmation today.”
FSI, which has been a staunch opponent of DOL’s fiduciary plan, said in a statement that it “looks forward to working with [Perez] in the future, especially as his department moves forward on their rule redefining the definition of ‘fiduciary.’”