DOL’s Recent Guidance on New Participant Fee Disclosure Regulations
The Department of Labor recently issued Field Assistance Bulletin 2012-02 (FAB 2-12-02), which provides guidance in the form of frequently asked questions (FAQs) regarding the participant fee disclosure regulations. The participant fee disclosure regulations require plan administrators to disclose certain plan and investment-related information, including fee and expense information, to participants and beneficiaries in participant-directed individual account plans, e.g., 401(k) plans. The FAQs make clear that the extensions of the deadline for compliance will not be available. Accordingly, calendar year plans will need to comply with the initial annual disclosures by August 30, 2012. For non-calendar year plans, the first annual disclosures are due by August 30, 2012, or if later, 60 days after the first day of the plan year beginning after November 1, 2011. However, the FAQs state that enforcement actions will generally be unnecessary if the covered service provider or plan administrator acts in “good faith” based on a “reasonable” interpretation of the final regulations and establishes a plan for complying with the regulations in future disclosures. The FAQs also provide guidance on the following topics that are covered by the regulation: covered individual account plans; plan-related information; disclosure of administrative expenses; plan-related information for brokerage windows; investment-related information; 404(c) compliance; and 408(b)(2) compliance with respect to covered service providers furnishing information to plan administrators so they can comply with the participant fee disclosure regulations.
For more information about the participant fee disclosure requirements for participant-directed individual account plans, please contact your Trust Fund counsel.
By Ezekiel D. Carder