28 Feb FEBRUARY 2017 FEDERAL COMPLIANCE UPDATES
Posted at 14:30h
in Benefits Administration, ClearPath blog, Employee Benefits, Employee Communication, employers, Helpful Tips, HR, Workplace
Make sure you are up-to-date with the most recent regulations issued by the Department of Labor.
FIDUCIARY FINAL RULE ISSUED
The U.S. Department of Labor (“DOL”) recently issued its final rule to address conflicts of interest in providing investment advice to sponsors and participants in 401(k)-type workplace retirement plans and individual retirement accounts (IRAs). Under the final rule, advisers and plan sponsors are allowed to provide general education on retirement saving without triggering fiduciary duties and liabilities. The final rule also describes the types of information and activities that constitute non-fiduciary education, including plan information and general financial, investment and retirement information.
The rule will require those providing investment advice to retirement plan sponsors and participants to follow the fiduciary standard of conduct under the Employee Retirement Income Security Act (“ERISA”). This will mean advisors may only offer advice that reflects loyalty to the “best interests” of plan participants and beneficiaries, and must disclose any potential conflicts of interest. Failure to do so means that advisors — and the plan sponsors that hire them — could be sued by participants and face ERISA-violation penalties.
The final rule applies to plan transactions on or after April 1, 2017. Additional conditions will take effect January 1, 2018, when all new systems and procedures must be in place. There is a grandfathering provision that allows for additional compensation based on investments that were made prior to the applicability date of April 1, 2017.
AMENDMENTS TO EMPLOYER-SPONSORED VISA PROGRAMS
Effective January 17, 2017, the U.S. Department of Homeland Security (“DHS”) amended final regulations to provide various benefits to participants in certain employment-based immigrant and nonimmigrant visa programs.
Among the amendments are improved processes and increased certainty for U.S. employers seeking to sponsor and retain immigrant and nonimmigrant workers, greater stability and job flexibility for those workers, and increased transparency and consistency in the application of DHS policy related to affected classifications.
For additional details, see the entire regulations here: Final Rule