Joint Trades Letter to DOL on Electronic Delivery for Retirement Plan Disclosures and Notices

Dear Assistant Secretary Rutledge:

The undersigned organizations are writing to urge the Department of Labor(“Department”) to expedite and prioritize the publication of proposed regulations that wouldexpand the use of electronic delivery for retirement plan disclosures and notices, while alsopreserving the option to receive paper delivery of such disclosures and notices. Specifically, weare requesting the Department to propose regulations, without delay, that would permit plansponsors to make electronic delivery the default method of delivery for retirement plandisclosures and notices, unless an employee otherwise requests paper copies.

On August 31, 2018, President Trump issued an Executive Order on StrengtheningRetirement Security in America directing the Department to review within one year actions thatwould make retirement plan disclosures more understandable and useful, while also reducing thecosts and burdens they impose on employers and other plan fiduciaries responsible for theirproduction and distribution. According to the Executive Order, the review shall explore thebroader use of electronic delivery as a way to improve the effectiveness of disclosures and toreduce their associated costs and burdens. The President’s 12-month deadline is, of course,rapidly approaching. We are encouraged to see the regulatory action included in the latestUnified Agenda and would urge the Department to further prioritize electronic delivery as a partof any rulemaking to reduce costs and burdens as outlined by the Executive Order.

Consistent with the Executive Order’s direction regarding electronic delivery, theinterested parties below are requesting the Department to expedite and prioritize the publicationof proposed regulations that would permit plan sponsors to make electronic delivery the defaultdelivery method for retirement plan disclosures and notices, unless an employee otherwiserequests paper copies. If finalized, those regulations would immediately make retirement plandisclosures and notices more efficient and useful for retirement savers. It also could makedisclosures and notices much less costly.

Electronic delivery empowers retirement plan participants by providing them constantand real-time access to information about their retirement benefits and other online tools that canassist with retirement planning. Retirement savers could more easily retain copies of benefitstatements, search for relevant information, and link to relevant information and options, such asincreasing their retirement contributions. In addition, electronic means enable plan sponsors to improve communications with plan participants such as by linking to financial wellnessopportunities and educational materials.

As evidenced by the dozens of House and Senate cosponsors backing the ReceivingElectronic Statements to Improve Retiree Earnings Act (“RETIRE Act”) during the 115thCongress, support for the electronic delivery of retirement plan communications, with a right topaper upon request, is widespread, bipartisan, and growing.

If necessary, the Department should move forward with guidance expanding the use ofelectronic delivery untethered to any other guidance projects seeking to change the substance orcontent of retirement plan disclosures. The Department could, for example, immediatelypropose regulations to expand the use of electronic delivery, while simultaneously issuing arequest for information (“RFI”) on ways to make the content of retirement plan disclosures andnotices more understandable and useful for retirement savers. The Department does not need tonewly engage in the same type of study for electronic delivery, because it previously receivedresponses to an RFI on electronic disclosure in 2011, and there is ample evidence of increasedaccess to and use of the Internet since then.

All of the undersigned organizations are supportive of the Department movingexpeditiously to enable the use of electronic delivery, and offer our expertise and resources toassist the Department. We are eager to work with the Department to accomplish the goals set outin the Executive Order. Please do not hesitate to reach out directly to any of the organizationsbelow.

American Bankers Association
American Council of Life Insurers
American Retirement Association
ERISA Industry Committee
Investment Company Institute
Securities Industry and Financial Markets Association
SPARK Institute
U.S. Chamber of Commerce

cc:
Timothy Hauser
Jeanne Wilson
Joseph Canary
Jeff Turner