Department of Labor

Subscribe to Department of Labor via RSS

On April 23, 2024, the Department of Labor (“DOL”) issued final rules which expand what it means to provide fiduciary “investment advice” under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”).  Though the final rules broaden the definition…

On April 3, 2024, the U.S. Department of Labor (the “DOL”) published in the federal register a final amendment to Prohibited Transaction Class Exemption 84-14 (the “QPAM Exemption”) that makes considerable changes to the exemption’s conditions (the “Final Amendment”).   Although the Final Amendment trims back some of the more onerous requirements floated in the proposed…

Last week, the Departments of Labor, Treasury and Health and Human Services (“the Departments”) issued an FAQ about the final Transparency in Coverage rules (“TiC Rules”). This FAQ addresses compliance with cost‑sharing disclosure requirements where a plan is providing cost estimates based on claims data but there is extremely low utilization of the item or…

The new “retirement security rule” package, issued by the U.S. Department of Labor (the “DOL”) on October 31, 2023, is the latest chapter in an almost 15-year effort by the DOL to amend the five-part test in its 1975 regulation for determining whether a person is a “fiduciary” by reason of providing “investment advice” for a fee (the “Five-Part Test”). (For more on the history, see here, here, and here.) The package includes a proposed new fiduciary “investment advice” rule (the “Proposed Rule”) and proposed amendments to certain prohibited transaction exemptions.

Very generally speaking, the Proposed Rule would significantly expand the circumstances under which a person could be treated as providing “investment advice” that is subject to ERISA’s fiduciary standards (including the self-dealing prohibited transaction rules). In particular, the Proposed Rule would replace the Five-Part Test’s requirements that advice be provided (1) on a “regular basis” pursuant to (2) a “mutual agreement, arrangement or understanding” that (3) it would serve as “a primary basis for investment decisions” with a much broader test that is based on the retirement investor’s reasonable expectations and context. The Proposed Rule would specifically cover a recommendation to roll over an account from an employer-sponsored plan (e.g., a 401(k) plan) into an individual retirement account (an “IRA”).