DOL Allows for E-Delivery of Retirement Plan Disclosures

In a move that will modernize the process for delivering required retirement plan notices and disclosures to retirement plan participants, the Department of Labor (DOL) and Employee Benefits Security Administration recently finalized a rule to allow disclosures and notices to be delivered by email or other electronic methods.

The rule, according to a fact sheet published by the DOL on May 21, 2020, allows plan administrators to use two methods for providing notices and disclosures to plan participants and beneficiaries, and offers welcome administrative relief to those responsible for administering their company’s workplace retirement plan. The two approved e-delivery methods are:

  • Website posting. Plan administrators may post covered documents on a website if appropriate notification of internet availability is furnished to the electronic addresses of covered individuals.
  • Email delivery. Alternatively, plan administrators may send covered documents directly to the electronic addresses of covered individuals, with the covered documents either in the body of the email or as an attachment to the email.

The new e-delivery guidelines are estimated to save approximately $3.2 billion in net costs to plans covered by the Employee Retirement Income Security Act (ERISA), including mailing and printing costs. The eligible notices and disclosures for e-delivery would include any retirement plan disclosures required by Title I of ERISA. Disclosures available on a by-request basis must still be furnished and would not be eligible for e-delivery. The rule takes effect July 27.

Retirement plan sponsors and administrators are encouraged to coordinate new e-delivery methods—including their nuances and finer details—and processes with their retirement plan service provider and third-party administrator to ensure that they are meeting the new guidelines and furnishing notices and disclosures in the appropriate manner.