DOL Extends Deadline for Annual Participant Fee Disclosure

On July 22, 2013, the Department of Labor (“DOL”) released Field Assistance Bulletin (“FAB”) 2013-02 granting a one-time extension to plan administrators of participant-directed individual account plans (such as 401(k) and 403(b) plans) to provide the annual participant-level fee disclosure required under ERISA section 404(a)(5).   The FAB announced a transitional enforcement policy regarding the due date for the second round of participant disclosures, which for most plans would otherwise have been August 30, 2013.  This relief permits plan administrators to align the annual participant-level fee disclosures with other participant notices typically made either just before or just after the beginning of a plan year.  This, in turn, would save duplicative mailing and processing costs and allow participants to receive the information at a time they are considering other plan disclosure materials.

Under the FAB, plan administrators may delay providing the required participant-level fee disclosures until a date that is no later than 18 months after the date of the initial round of disclosures.  For example, if the initial disclosure was given on August 25, 2012, the next round must be given no later than February 25, 2014. If the plan administrator has already given out the 2013 second round, the FAB will allow the one-time transitional election to be exercised with regard to the 2014 disclosures.

The DOL is further considering whether the annual requirement would continue to impose a deadline that is exactly 12 months after the prior disclosure or whether the regulation should be amended to provide a more flexible 30- or 45-day disclosure window. 


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