Legislative and Regulatory News for the Week of June 21

Posted on June 27, 2009 by Governmental Affairs Team

The following is a summary of the labor- and employment-related regulatory and legislative news for the week of June 21, 2009:

Agency Changes

The Senate confirmed the nomination of Jane Oates to be the assistant secretary of the Department of Labor’s Employment and Training Administration (ETA).

Business Restructuring

The FOREWARN Act was reintroduced in both the House and Senate. This bill would amend the Worker Adjustment and Retraining Notification (WARN) Act to expand mass layoff and plant closing notification requirements, and increase employer penalties for violations.

Discrimination in the Workplace

Rep. Barney Frank (D-Mass.) reintroduced the Employment Non-Discrimination Act of 2009, a bill that would create employment protections for workers based on their sexual orientation or gender identity.

Employee Benefits

The House Committee on Education and Labor passed the 401(k) Fair Disclosure for Retirement Security Act, a bill that would require the disclosure of hidden 401(k) fees, prevent conflicts of interest in the provision of investment advice, and grant funding relief to pension plans.

Health Care

House Democrats released a draft of their massive healthcare reform bill.
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Final Regulations Governing Automatic Contribution Arrangements for Pension Plans Are Published

Posted on February 25, 2009 by Jay Sumner

On February 24, the Internal Revenue Service (IRS) published in the Federal Register its final rule regarding automatic contributions to 401(k) plans and similar types of defined contribution plans. Such automatic enrollment features were established by the Pension Protection Act (Pub. L. No. 109-280), which amended the tax code to facilitate automatic enrollment for 401(k) plans, Section 403(b) tax-deferred annuity plans, Section 457(b) governmental plans, and similar arrangements. These regulations affect administrators of, employers maintaining, participants in, and beneficiaries of section 401(k) plans and other eligible plans that include an automatic contribution setup. Among other things, the regulations clarify minimum percentage requirements for qualified automatic contribution arrangements (QACA), expand uniformity requirements, and establish a notice timing requirement.

The final regulations relating to qualified automatic contribution arrangements apply to plan years beginning on or after January 1, 2008. The regulations relating to eligible automatic contribution arrangements apply for plan years beginning on or after January 1, 2010.

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EBSA Proposes Extension Date for its Investment Advice Regulations

Posted on February 5, 2009 by Governmental Affairs Team

Pursuant to the January 20, 2009 memo by Chief of Staff Rahm Emanuel directing all federal agency heads to consider extending the effective dates of regulations that had been published in the Federal Register but had not yet taken effect, the Department of Labor’s Employee Benefits Security Administration (EBSA) has issued a notice. The notice proposes an extension of the effective and applicability dates of final regulations on investment advice provided to participants and beneficiaries of 401(k) plans and IRAs. The regulations, which apply to transactions occurring on or after March 23, 2009, would be extended 60 days until May 22, 2009.

These regulations – which govern the provision of investment advice by a fiduciary adviser to participants and beneficiaries of participant-directed individual account plans and to beneficiaries of individual retirement accounts – were first published in the January 21, 2009 edition of the Federal Register. The proposed extension would allow the EBSA to evaluate comments on questions of law and policy regarding the regulations. To that end, the EBSA is seeking comments on the rules themselves and on the merits of rescinding, modifying or retaining the regulations.

Comments on the proposal to extend the effective and applicability dates must be submitted to the EBSA by February 18, 2009. Comments on the provisions themselves should be submitted on or before March 6, 2009 to the Office of Regulations and Interpretations, Employee Benefits Security Administration, Attn: Investment Advice Final Rule, Room N-5655, U.S. Department of Labor, 200 Constitution Avenue, NW, Washington, DC 20210. Comments may also be submitted electronically by email to e-ORI@dol.gov (enter into subject line: Investment Advice Final Rule) or via the agency’s website at http://www.regulations.gov.  Please contact Susan Hoffman of Littler’s Philadelphia Office if you have any questions or seek further information about these regulations.
 
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