As interest rates rise and the threat of a recession looms, many employers are beginning to struggle with balancing the cost of maintaining their workforce with an expected decrease in profits. The frequent result of such a balancing act is a mass layoff. While a reduction in workforce may be inevitable, below are options that employers can consider to try to avoid that outcome. For all of these alternatives, employers should apply any changes consistently across the workforce to avoid claims of inequity or discrimination.
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 existing “opt in” regime with an “opt out” regime. Instead of requiring affirmative consent to distribute communications electronically, many plan sponsors and service providers would like the default to be electronic disclosure–with an opportunity to elect to receive paper.
In 2011, the Department of Labor issued a public request for information regarding electronic disclosures. The responses included thoughtful suggestions for moving toward an “opt out” regime while still ensuring that important communications are actually received. The Department has not formally taken action in response to the RFI, but comments included in the GAO report offer insight into the Department’s thinking.
The GAO report summarizes the existing Labor and Treasury rules on electronic disclosure, and offers three suggestions for improvement:…
Continue Reading Electronic Disclosure: Which Way Are We Going?
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 the plan when the Clearing Member exercises discretionary account liquidation rights upon the plan’s default. The opinion also provides guidance on prohibited transaction issues raised by the clearing process.
Continue Reading Labor Department Addresses Key Issues for Cleared Swaps