Topic: Retirement Plans

Retirement plans of all sizes often find themselves faced with participants or beneficiaries who are either missing or do not respond to communication. The U.S. Department of Labor (“DOL”) has long been concerned with how plans try to locate and contact these ‘missing’ participants and, more importantly, how they try to prevent participants from becoming ‘missing’ in the first place.

The economic uncertainty of the COVID-19 pandemic has forced many employers to furlough or layoff a significant percentage of their workforce.  These workforce reductions may inadvertently cause a “partial termination” of the employer’s qualified retirement plan triggering a requirement that all affected participants become 100% vested in their plan accounts.

We are now a few months into 2020 and we should all be feeling more SECURE in our ‎retirement, as a result of the “Setting Every Community Up for Retirement Enhancement Act of ‎‎2019” (“SECURE Act”). Below is a brief summary of the key changes that could impact ‎qualified retirement plans, depending on the terms of those plans and the desires of the plan ‎sponsors from a design perspective.‎

A recent Chief Counsel Memorandum (“CCM”) makes clear that a qualified retirement plan can ‎face disqualification if the plan sponsor cannot provide a copy of an executed plan document or ‎plan amendment upon audit.

The United States Supreme Court, in a per curiam decision, declined to address whether plan ‎participants sufficiently alleged breach of fiduciary duty claims under the Employee Retirement ‎Income Security Act of 1974, as amended (“ERISA”) against fiduciaries of an employee stock ‎ownership plan for failing to disclose inside information that ultimately led to a declining stock ‎value, remanding the case to the Court of Appeals for the Second Circuit.‎