Explaining the PBGC missing participant program Best practices for preventing & locating missing participants The DOL provided a list of unrequired, but suggested, best practices. Topics Addressed: State upfront and prominently what correspondence is about, and make it identifiable to participants. Deciphering the DOL Best Practices for Missing Participants. In 2013, the council recommended that the DOL develop best practices for finding missing participants, and, in 2014, the DOL issued a Field Assistance Bulletin stating that, "consistent with their obligations of prudence and loyalty, plan fiduciaries must make reasonable efforts to locate missing participants or beneficiaries." Missing ParticipantsBest Practices. However, the guidance does not establish the type of clear, bright-line rules many plan sponsors and services providers were asking for. Best Practices for Preventing and Locating Missing Participants EBSA outlined best practices that it has found "effective at minimizing and mitigating the problem of missing or nonresponsive participants," summarized below. Best Practices Being Proactive The DOL states in the publication that the following "best practices" are effective at minimizing and mitigating the problem of missing or nonresponsive participants: Maintaining accurate census information for the plan's participant population. FAB 2020-01 Best Practices The DOL has issued more guidance on missing participants, including a temporary enforcement policy on use of the PBGC's expanded Missing Participants Program (PBGC Program) and informal guidance on best practices for dealing with missing and unresponsive participants. March 8, 2021. By Jane Smith. The first describes "red flags" that signify a plan fiduciary might have issues with Missing Participants and sets forth the DOL's suggested best practices to remedy the issues. However, the guidance does not establish the type of clear, bright-line rules many plan sponsors and services providers were asking for. This is perhaps the most informative piece of guidance of the three as it provides a number of practical, helpful red flags to watch out for and "best practices" for dealing with the various flavors of missing participants. "If at first you don't succeed, try, try again.". Compliance Assistance Release 2021-01 . Unlike the DOL, the IRS's Oct. 19, 2017, administrative enforcement guidance does not require that a retirement plan's administrator identify and . In January 2021, the U.S. Department of Labor (DOL) issued best practices for missing participants to help fiduciaries of defined benefit and . A page titled "Missing Participants - Best Practices for Pension Plans" describes a range of best practices for fiduciaries of retirement plans to consider. As the DOL states in its Best Practices, the first step in addressing any problem is knowing it exists. Plans with low numbers of missing and nonresponsive participants and beneficiaries frequently use best practices that include: Updating census files to ensure that plans have accurate information for all participants and beneficiaries Implementing effective communications programs Strengthening missing participant searches Note that our standard services do not incorporate all the best practices set forth in the DOL guidance, so please consider additional measures to minimize missing participants and outstanding checks - including adding our enhanced missing participant offering through Fidelity Workplace Consulting. Best Practices for Missing Participants . Guidance seeks to help protect an estimated $9.3T in assets WASHINGTON, DC - The U.S. Department of Labor today announced new guidance for plan sponsors, plan fiduciaries, record keepers and plan participants on best practices for maintaining cybersecurity, including tips on how to protect the retirement benefits of America's workers. Plan fiduciaries should determine which practices will be most effective for the plan's specific population. The Department of Labor unveiled three pieces of guidance late Tuesday related to missing participants. Watch the presentation >> | View the slides >> Tuesday, March 23, 2021: 12:30 PM . Following several years of investigating how plans do, or do not, stay in touch with former employees who are due benefits, in January 2021, the Labor Department published a best practices guide for pension and retirement savings plans, "Best Practices for . In January, the U.S. Department of Labor (DOL) published a three-part package of sub-regulatory guidance addressing the topic of missing plan participants. The Department of Labor recently issued informal "best practices" guidance designed to help employers locate missing retirement plan participants to ensure they receive their promised benefits. Recently issued Department of Labor guidance is an important step toward resolving the "missing participants" problem. The DOL noted that these practices may not all be appropriate for each plan, but plan sponsors should review and implement changes where appropriate. The study, Improving the Effectiveness of Electronic Missing Participant Searches, comes on the heels of Department of Labor (DOL) guidance on the topic and is highly-useful for plan sponsors who utilize electronic searches, or "e-Searches" as they are . based on its experience in investigating plan sponsors, dol identified the following "red flags" that are often warnings or indicators of a problem with missing or nonresponsive participants: (1). On January 12, 2021, the Department of Labor (DOL) issued a 3-part set of missing participant guidance for employer-sponsored retirement plans, addressing a variety of issues: . Following are some highlights. The guidance takes a three-prong approach, as follows: DOL Best Practices for Locating and Tracking Missing Participants; DOL Temporary Enforcement Policy on Fiduciaries of Abandoned Insolvent Plans, and The Fundamentals of Locating Missing Participants The Definitive Guide to Missing Participants The definitive guide to the problem of missing participants in 401(k) and 401(k)-like plans, providing answers to key questions, as well as information and links to explore the many aspects of this important issue. The DOL suggests the following practices in communications with participants and beneficiaries: Use plain language and offer non-English assistance, and encourage contact through the plan/plan sponsor website and toll free numbers. With a written policy and consistent procedures, a retirement plan can establish best practices to handle the problems that missing participants can create. On January 12, 2021, the Department of Labor (DOL) released FieldAssistance Bulletin (FAB) 2021 - 01, announcing its temporary nonenforcement policy for use of the Pension Benefit - Guaranty Corporation (PBGC)'s Defined Contribution Missing Participants Program (Program), applicable to The second part of the DOL's January 12 . 2021-01. The guidance provides DOL's views on what is "best practices" in searching for missing participants and a glimpse into DOL's enforcement process under its missing participant initiative. The Search for Missing Participants Continues: DOL Guidelines and Best Practices. Topics include: Background on the "missing participant problem". Best Practices for Preventing and Locating Missing Participants. Missing ParticipantsBest Practices for Pension Plans describes best practices that fiduciaries of defined benefit pension plans or 401(k)-type defined contribution plans can take to ensure that . Administering retirement plan distributions with respect to missing participants and uncashed checks has been a vexing challenge for plan administrators, particularly because . Plan sponsors know the challenges of keeping track of participants, especially those in retirement or who no longer work for the company. Goldberg echoes the fact that the DOL guidance "gets pretty granular about what it considers to be best practices." On January 18, we published a blog post regarding new Department of Labor ("DOL") guidance on missing plan participants. But on January 12, 2021, the DOL finally issued its long-awaited missing participant guidance. " Best Practices for Pension Plans " describes a range of best practices fiduciaries of retirement plans, including defined contribution (DC) plans, should consider as steps their plan could take to help reduce missing participant issues and ensure that plan participants receive promised benefits when they reach retirement age. "Perhaps it is a new approach the DOL is taking when it comes to providing guidance," he says. 1 Maintaining accurate census information for the plan's participant population. Securities Exchange Commission (SEC) 17 CFR 240.17Ad-17: SEC 17 CFR 240.17Ad-17 is a regulation outlining search efforts that broker-dealers and transfer agents should conduct if they maintain accounts of missing or lost accountholders. The Department of Labor issued long-awaited guidance on missing retirement plan participants Tuesday evening, calling it part of its effort to help plan fiduciaries meet their obligations under ERISA to locate and distribute retirement benefits to missing or non-responsive participants. Join me for a Q&A session as we navigate the new #DOL best practices guidance for #missing #participants.I'm happy to join Morgan Lewis ERISA vets Liz Goldberg and Lindsay Jackson for their . This document identifies red flags that might indicate that a plan has a problem with missing participants. DOL best practices for missing participants and pension plans: DOL best practices for missing . The U.S. Department of Labor (DOL) has issued guidance on best practices for locating missing participants in defined benefit and defined contribution retirement plans. " Best Practices for Pension Plans " describes a range of best practices fiduciaries of retirement plans, including defined contribution (DC) plans, should consider as steps their plan could take to help reduce missing participant issues and ensure that plan participants receive promised benefits when they reach retirement age. 1. Best Practices for Preventing and Locating Missing Participants EBSA outlined best practices that it has found "effective at minimizing and mitigating the problem of missing or nonresponsive participants," summarized below. In January 2021, the U.S. Department of Labor (DOL) issued best practices for missing participants to help fiduciaries of defined benefit and defined contribution plans, such as 401 (k) plans, weigh which practices could help minimize the numbers of missing participants and uncashed checks. The best practices consist of the following: Maintaining accurate census information for the plan's participant population. The DOL has developed the following best practice guidance to assist plan fiduciaries in minimizing the missing participant problems in their plans. The DOL recently issued three pieces of guidance on cybersecurity best practices for employee benefit plan sponsors, fiduciaries, recordkeepers, participants and beneficiaries: (1) Tips for Hiring a Service Provider With Strong Cybersecurity Practices, (2) Cybersecurity Program Best Practices, and (3) Online Security Tips.This is the first time the DOL has issued comprehensive guidance . In this article, we'll help you sort through the Best Practices to . It may not be the mantra of plan sponsors, but this old adage certainly sums up the Department of Labor's (DOL's) approach to the fiduciary duty of searching for missing plan participants. Unfortunately, not every Best Practice will be appropriate for every plan. He says the DOL's recent guidance on missing participants also provided details about processes. They include: More than a "small number" of missing participants; More than a "small number" of terminated participants who have reached retirement age but have not yet started receiving . Based on EBSA's experience working with plans, the following practices have proven effective at minimizing and mitigating the problem of missing or nonresponsive participants. For whatever reason, the cannot be located to deliver withdrawal paperwork or cash-out checks. The first is Field Assistance Bulletin (FAB) 2021-01 . Consequently, on January 12, 2021, the DOL provided three official documents to provide guidance on how to define a missing participant, how to locate the participant, and how the DOL will audit plans (both Defined Contribution (DC) and DB) moving forward. On January 12, the DOL provided three long-awaited pieces of sub-regulatory guidance that provide some clarity. Let's take a quick tour of what was included. . Missing Participants - Best Practices for Pension Plans (dol.gov) DOL's Goals and Process in Missing Participant Audits. The Department also stresses that ERISA's fiduciary obligations fully apply to missing participants whose accounts the plan purports to treat as "conditionally forfeited" under Treasury Regulation 1.411(a)-4(b)(6). best practice tips apply equally to both types of plans. The first outlined a range of best practices retirement plan fiduciaries should consider to. Compliance Assistance Release No. The guidance included three parts. Best Practices for Pension Plans describes a range of best practices fiduciaries of retirement plans, such as 401 (k) plans, should consider as steps their plan could take to help reduce missing participant issues and ensure that plan participants receive promised benefits when they reach retirement age; Best Practices for Missing Plan Participants In January 2021, the Department of Labor (DOL) released new guidance on dealing with missing participants - former employees with a retirement account balance. According to the guidance, the following practices should be used to minimize and mitigate the problem of missing or non-responsive participants. More than a small number of terminated vested. The DOL has issued additional guidance to assist fiduciaries in meeting their obligations to missing participants. May 21, 2021. In January 2021, the Department of Labor (DOL) provided guidance on the issues of missing participants and uncashed checks. The new guidance Missing Participants Best Practices for Pension Plans is an informational document that identifies "red flags," including: Not having systems in place to avoid missing participants losing benefits Having structural and search practices that minimize missing-participant violations Best Practices for Pension Plans. Participating plans can either transfer all missing participants' accounts to PBGC or none of them. Join us for a focused discussion of the Department of Labor new guidance on missing participants and its implications for retirement plan fiduciaries and service providers. The guidance is in three forms: Best Practices for Pension . DOL explains that the following are red flags, indicating plans may have a problem: More than a small number of missing or nonresponsive participants. Under Title I of ERISA, plan fiduciaries retain full responsibility for Maintaining accurate census information for the plan's participant population by: Contacting participants and beneficiaries on a periodic basis to confirm or update their contact information; Here are the . According to DOL FAB 2004-02, plan fiduciaries are responsible for locating missing participants and providing them with options to distribute their benefits. IRS Issues Guidance on Missing Plan Participants. The DOL's " Missing Participants Best Practices for Pension Plans " describes a range of steps that retirement plan fiduciaries should consider to locate missing or nonresponsive participants. The DOL's guidance, issued January 12, 2021, includes a host of best practices (the "Best Practices") plan sponsors and other fiduciaries can use to locate missing or nonresponsive participants. More than a small number of terminated vested participants who have reached normal retirement age but have not started receiving pension benefits. This blog post addresses two other pieces of guidance issued by the DOL in conjunction with its Best Practices guidance -(i . On January 12, 2021, the DOL issued three pieces of guidance on the Missing Participant issue. While numerous DOL audits have centered on this issue, and the DOL has issued guidance on fiduciary duties and missing participants in terminating defined contribution plans (e.g., FAB 2014-01 . John Nownes, JD. The guidance included three parts. March 19, 2021. In January 2021, the Department of Labor (DOL) provided guidance on the issues of missing participants and uncashed checks. New DOL guidance on missing plan participants. 12:00 PM - 01:00 PM CT. 10:00 AM - 11:00 AM PT. Missing Participants Guidance. Missing Participants - Best Practices for Pension Plans DOL's "best practices" document outlines its view of the "best practices that the fiduciaries of defined benefit and defined contribution plans, such as 401 (k) plans, can follow to ensure that plan participants and beneficiaries receive promised benefits when they reach retirement age." Best practices for missing participants The document, titled "Best Practices for Pension Plans," lists the following "red flags" that suggest to the DOL that an employer may have a problem with missing participants: More than a small number of missing or nonresponsive participants; These are applicable to both defined benefit and defined contribution plans. DOL explains that the following are red flags, indicating plans may have a problem: More than a small number of missing or nonresponsive participants. Guidance 1: Missing Participant -Best Practices for Pension Plans Applies to both defined contribution plans, such as 401(k) plans, and defined benefit plans. 1. In late 2017, PBGC overhauled its missing participant program which previously covered only defined benefit (DB) plans to let certain terminating DC plans participate for the first time. 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