DOL Adopts Electronic Disclosure Safe Harbor for Employee Benefit Plans
Commentary by Steven Lofchie
The DOL adopted a rule amendment to create a new safe harbor which allows certain employee benefit plan administrators to provide plan participants with information using electronic media as the default method of delivery.
The safe harbor adopts a notice-and-access framework pursuant to which plan administrators may furnish a notice to plan participants that certain disclosures will be made available on a website or sent via email. Participants who prefer paper copies of disclosures will be permitted to opt out of electronic delivery.
According to the DOL, the final rule is intended to "enhance" the efficacy of ERISA disclosures as well as to decrease administrative costs and burdens. The DOL stated that the rule will provide assistance to employers and service providers facing logistical impediments as a result of COVID-19.
The final rule goes into effect and is applicable on July 27, 2020.
Commentary
All U.S. regulators should give consideration to whether the current requirements to provide paper notices are outdated or at least over-broad.