Electronic Delivery of Participant Disclosure Materials
Retirement plan participants must receive specific plan information annually. The plan administrator must use measures “reasonably calculated to ensure actual receipt of the material” when delivering this information. You will not satisfy the delivery requirement by making a document available or posting it on a bulletin board. You may use in-hand delivery to the employee’s worksite and first class mail, and you can use other classes of mail if return and forwarding postage are guaranteed and address corrections are requested. However, a growing number of plan administrators prefer electronic delivery to simplify the process and reduce costs.
ELECTRONIC DELIVERY GUIDELINES
The Department of Labor (DOL) and the Internal Revenue Service (IRS) established guidelines to help plan administrators determine when e-mail or other delivery methods are acceptable.
- DOL Electronic Disclosure Safe Harbor allows electronic delivery by the Wired at Work and Affirmative Consent methods
- DOL Interpretive and Technical guidance allows for use of the Assumed Consent and Continuous Access Website methods; and
- IRS Media Disclosure Guidance allows electronic delivery under a General Method and an Alternative Method.
In general, the DOL Safe Harbor methods are applicable to all types of plan information, while the other methods are more restrictive. For more information about the DOL’s electronic delivery guidelines, check out the DOL Electronic Disclosure Guidance blog.
Electronic delivery of plan information is not all or nothing. For example, you may use e-mail to deliver information to employees with computer access at work and mail to the remaining plan participants.
DISCLOSURE REQUIREMENTS THAT CAN BE ELECTRONICALLY DELIVERED
For reference, below is a table detailing the delivery options applicable to various disclosures.
Related Articles You Might Like
The IRS requires several annual nondiscrimination tests for defined contribution retirement plans, and the top-heavy test is one of those. A retirement plan is top-heavy when, as of the last day of the preceding plan year (the determination date), the total value of...
On June 3, 2022, the IRS announced a pilot pre-examination retirement plan compliance program beginning in June 2022. Under the pilot program, the IRS will notify a qualified retirement plan sponsor by letter that their retirement plan has been selected for an...
Retirement plan record retention rules are found in both the Department of Labor (“DOL”) Regulations and the Employee Retirement Income Security Act of 1974 (ERISA), plus there are statutes of limitation concerns in relation to retirement plan sponsor liability for...