The U.S. Department of Labor (DOL) has announced a final rule that will increase access to overtime pay under the Fair Labor Standards Act (FLSA) for approximately 1.3 million workers. The final rule, which comes six months after DOL published a proposed rule in March, is the latest development in a years-long process by DOL, … Continue Reading
On Wednesday, April 18th, the SEC introduced a much-anticipated package of proposed rules and formal guidance concerning the standards of conduct for financial professionals. The more than 1,000-page proposal, which emerged eight years after Congress required the agency to conduct a study on the topic, addresses whether investment advisers and broker-dealers should have identical or … Continue Reading
Our colleague Jason Levy recently published an article in The Actuary Magazine on the Department of Labor’s fiduciary conflict rule. More than six years in the making, this rule represents perhaps the most significant regulation from the DOL during the Obama Administration. The fiduciary conflict rule expands the definition of fiduciary to cover, with certain … Continue Reading
On January 20, the Department of Labor’s Wage and Hour Division (WHD) issued new guidance on joint employment under the Fair Labor Standards Act (FLSA). The guidance marks the third time in recent years that WHD has stressed the broad definition of “employment” under the FLSA, following June 2014 guidance on joint employment in the … Continue Reading
The ERISA Advisory Council held a hearing last week on “Model Notices and Disclosures for Pension Risk Transfers.” The Council, which advises the Secretary of Labor on the Labor Department’s administration of ERISA, is working to develop model disclosures to participants who receive lump sum offers in connection with de-risking transactions. While the Council is … Continue Reading
On March 26, 2015—just one day before the Final Rule for the Family Medical Leave Act (“FMLA”) was to take effect—a federal court in Texas blocked the Final Rule’s application to the states of Texas, Arkansas, Louisiana, and Nebraska, pending a full determination of the issue on the merits in Texas v. United States. The … Continue Reading
Two cases decided in January—one by the Sixth Circuit and another by the District Court for the District of Columbia—offer a cautionary tale to plan sponsors who rely on a statute or regulation that allows retroactive amendments to tax-qualified plans. Both cases involved a change to the interest and mortality assumptions that pension plans use … Continue Reading
A recent GAO Report offers interesting insight into the Department of Labor’s thinking on electronic disclosure. For the better part of the last ten years, many plan sponsors and service providers have been pushing for more flexibility to provide required disclosures electronically. In particular, they have asked the Labor and Treasury Departments to replace an … Continue Reading
The Department of Labor’s Office of Inspector General recently issued a report detailing concerns with the valuation of alternative investments (such as private equity funds, hedge funds, and real estate) held by ERISA plans. ERISA requires plan sponsors and fiduciaries to value investments for several purposes, including to determine funding obligations, select investments, monitor investment … Continue Reading
The Department of Labor issued a technical release today addressing the effect of the Supreme Court’s decision in U.S. v. Windsor on employee benefit plans. The Windsor decision struck down section 3 of the Defense of Marriage Act, thereby requiring the federal government to recognize same-sex marriages that are recognized under state law. The IRS … Continue Reading
On July 31st, the Office of Federal Contract Compliance Programs (“OFCCP”) of the Department of Labor submitted to the Office of Management and Budget (“OMB”) a final rule revising federal regulations regarding affirmative action for individuals with disabilities by covered federal contractors and subcontractors. If adopted, the regulations would mark the first time the federal … Continue Reading
The Departments of Treasury, Labor, and Health and Human Services (collectively, the “Departments”) recently issued a set of Frequently Asked Questions (Part XV) (the “FAQs”), which provide that, starting in 2014, employers and health insurance issuers must implement two new requirements under ACA that apply to non-grandfathered group health plans: (1) a prohibition on discriminating … Continue Reading
On April 23, 2013, the Departments of Labor, Health and Human Services and the Treasury (the “Departments”) issued an updated template and sample completed template for summaries of benefits and coverage (“SBCs”) that must be provided for coverage beginning in 2014. The Departments also released Frequently Asked Questions that include the following guidance: The only … Continue Reading
The Department of Labor resolved key issues related to cleared swaps transactions in a recent advisory opinion. The opinion concludes that margin posted by an employee benefit plan in connection with a cleared swap is not a “plan asset” for purposes of ERISA, and that a Clearing Member does not act as a fiduciary of … Continue Reading
Misclassification of workers remains a hot button issue. The IRS continues to scrutinize employers’ worker classification practices, and it is likely that health reform will cause the Department of Labor to review classification issues even more closely than it has in the past. In an effort to encourage employers to reclassify independent contractors as employees, … Continue Reading
The IRS and Department of Labor recently announced additional relief for victims of Hurricane Sandy. Loans and Hardship Distributions from Defined Contribution Plans. In Announcement 2012-44, the IRS relaxed the rules governing loans and hardship distributions from 401(k), 403(b) and state and local government 457(b) defined contribution plans. There are several components to the relief: … Continue Reading
On November 26, 2012, the IRS and Departments of Labor and Health and Human Services published in the Federal Register proposed regulations that would permit group health plans to provide greater incentives for participation in wellness programs. The proposed regulations include a welcome implementation of statutory changes that were made by the Affordable Care Act, … Continue Reading
Courts continue to apply the fiduciary exception to the attorney-client privilege to the fiduciaries of ERISA-governed plans. Under the fiduciary exception, plan participants and the Secretary of Labor can obtain testimony or documents relating to confidential communications between plan fiduciaries and their lawyers regarding plan administration. Although the Third Circuit has ruled that the fiduciary … Continue Reading
Beginning in 2011, the medical loss ratio (MLR) requirements of the Affordable Care Act require health insurers to spend at least 85% of premiums for large group policies on medical expenses and activities to improve health care quality. If an insurer does not meet this requirement, it must rebate to the employer a portion of … Continue Reading
