| Dear Center Members: |
This alert contains information about:
- DOL Issues Final Rule on Association Retirement Plans
- DOL Provides Filing Relief for Certain Multiple Employer Plans (MEPs)
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DOL Issues Final Rule on Association Retirement Plans
The DOL issued a final regulation, Definition of "Employer" Under Section 3(5) of ERISA-Association Retirement Plans and Other Multiple-Employer Plans, that expands access to retirement saving options by clarifying the circumstances under which an employer group or association or a professional employer organization (PEO) may sponsor a multiple employer workplace retirement plan under title I of ERISA (as opposed to providing an arrangement that constitutes multiple separate retirement plans). Under the rule, association retirement plans can be offered by associations of employers in a city, county, state, or a multi-state metropolitan area, or in a particular industry nationwide. In addition to association sponsors, the plans can also be sponsored through a PEO which is a human-resource company that contractually assumes certain employment responsibilities for its client employers.
The final regulation does this by clarifying that employer groups or associations and PEOs can, when satisfying certain criteria, constitute "employers" within the meaning of ERISA for purposes of establishing or maintaining an individual account "employee pension benefit plan" within the meaning of ERISA. As an "employer," a group or association, as well as a PEO, can sponsor a defined contribution retirement plan for its members (collectively referred to as "multiple employer plans" or "MEPs" unless otherwise specified). Thus, different businesses may join a MEP, either through a group or association or through a PEO.
The final regulation also permits certain working owners without employees to participate in a MEP sponsored by an employer group or association.
Click here for the final DOL rule.
DOL Provides Filing Relief for Certain Multiple Employer Plans (MEPs)
DOL EBSA issued Field Assistance Bulletin 2019-01, Annual Reporting Requirements for Multiple Employer Plans Subject to ERISA section 103(g), (FAB 2019-01) which provides guidance and temporary penalty relief related to certain Form 5500 Annual Return/Report requirements for multiple employer plans (MEPs) subject to ERISA Section 103(g).
EBSA has found that a substantial number of MEP filers were not in full compliance with this reporting obligation including failure to include a complete and accurate list of participating employers with their Form 5500/5500-SF. Examples of non-compliant filings included forms in which the filer replaced employer names with either abbreviated names or initials, client numbers, or other labels such as "Client 1"; the filing reported only the last 4 digits of EINs; the filing included an attachment with no information and a note "Details available upon request"; and the filing incorrectly listed the PEO as the only participating employer.
While EBSA expects full compliance with these reporting obligations on a prospective basis, FAB 2019-01 gives transition relief for MEPs that have failed to file a complete and accurate list of participating employers with their Form 5500 for the 2017 plan year and before.
Click here for DOL FAB 2019-01.
Sincerely,
AICPA Employee Benefit Plans Audit Quality Center |
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