10.09.2024 01.44 CDT
Two cases reach opposite conclusions on whether employers must use forfeitures to play plan expenses—and are (effectively) precluded from using them to reduce employer contributions.
New Front on Fiduciary Litigation?
Two cases reach opposite conclusions on whether employers must use forfeitures to play plan expenses—and are (effectively) precluded from using them to reduce employer contributions.
In two recent court decisions (Hutchins v. HP Inc and Perez-Cruet v. Qualcomm Inc) plaintiffs claimed that employers’ decision to use forfeitures to reduce employer contributions (and not to pay for plan administrative expenses) was a breach of ERISA fiduciary responsibility. The courts reached opposite conclusions in these cases—with one court (Hutchins) dismissing the complaint and the other (Perez-Cruet) denying the motion to dismiss and allowing the case to proceed.
26.08.2024 09.07 CDT
New lawsuit makes serious allegations that TIAA stacked the deck to enhance profitability
New Lawsuit Targets TIAA and Morningstar
New lawsuit makes serious allegations that TIAA stacked the deck to enhance profitability
A new fiduciary case alleges that TIAA and Morningstar colluded to alter asset allocation tools to promote certain TIAA annuities. The case is directed at TIAA and Morningstar, rather than at plan sponsors—and could create liability for TIAA and Morningstar for both ERISA and non-ERISA plans. The complaint rehashes some old criticism of TIAA—but also contains some significant new accusations. If this case succeeds, it could have some far-reaching implications.
25.07.2024 01.57 CDT
New IRS guidance clarifies how employees can access their funds in an emergency.
New Rules for Emergency Distributions
New IRS guidance clarifies provisions of SECURE 2.0 allowing employees to access their funds in an emergency.
The IRS has recently released Notice 2024-55, providing guidance on provisions of SECURE 2.0 dealing with certain emergency distributions from retirement plans and distributions to victims of domestic abuse.
24.06.2024 04.17 CDT
DOL narrows rules for employers to join together in offering benefit plans.
The U.S. Department of Labor (DOL) has issued new guidance narrowing when a group of unrelated employers can join together and form an association health plan (“AHP”)—a plan that is treated as a single employer plan under ERISA. The new guidance narrows the circumstances under which an AHP can be considered an employer-sponsored plan under ERISA. This ruling may also foretell changes to the rules governing multiple employer retirement plans (MEPs).
13.05.2024 01.08 CDT
DOL Tries (Again) to Replace 1975 Rules and Redefine ERISA Investment Fiduciaries.
The United States Department of Labor has finalized new rules defining who is an investment fiduciary under ERISA. These new final rules mark the latest effort (started in 2010) to update a fiduciary definition that was initially adopted in 1975. The DOL also issued a new exemption allowing these fiduciaries to engage in certain transactions (such as accepting commissions) that would otherwise be prohibited.