The Department of Labor (DOL) proposed a new rule to allow retirement plan disclosures to be posted online.
The new rule allows plan administrators to post any document that the administrator is required to furnish under ERISA on the plan sponsor’s website, as long as the administrator furnishes a “notice of internet availability” concerning the posted document and complies with certain additional requirements.
A plan administrator has to provide a “notice of internet availability” for each document it intends to post on its website. The administrator must furnish the notice at the time the document is made available on the website.
The notice of internet availability has to include the following contents:
- A statement about the subject matter of the notice;
- A statement that important information about the recipient’s retirement plan is available at the website identified in the notice;
- A brief description of the covered document;
- A statement of the recipient’s right to request and obtain a paper version of the covered document, free of charge, and an explanation of how to exercise that right;
- A statement of the recipient’s right to opt-out of receiving covered documents electronically, and an explanation of how to exercise that right; and
- The telephone number of the plan administrator or other designated plan representative.
This is a great thing for the retirement plan industry as hundreds of millions of dollars will be saved in printing and mailing costs. It will be bad for the paper industry, but good for the retirement plan industry and plan sponsor because I believe the lower costs will be passed down to plan participants through decreased costs. I’m sure some cynical people will say those plan providers will pocket the difference, but fee transparency and competition won’t allow that.