Now that the July 1, 2012 deadline has passed for ERISA “covered service providers” to inform “responsible plan fiduciaries” about the services performed for their retirement plans and the investment management, recordkeeping, and other fees charged to those plans, it is time for employers and other plan fiduciaries to take action.

First, plan fiduciaries must review the information provided by the covered service providers. If any information appears to be missing or is incomplete, a plan fiduciary must request the missing information from the covered service provider in writing. If the information is not provided within 90 days, the plan fiduciary will need to notify the Department of Labor. In addition, plan fiduciaries must analyze all of the information provided by plan service providers. If a fiduciary does not conclude that the service provider’s fees are reasonable for the services it performs, the fiduciary must take appropriate action, such as negotiating lower fees or finding a new service provider.  This review and analysis process must be documented in order to demonstrate fulfillment of one’s fiduciary duties.

In addition, the plan administrators of individual account plans (usually, the employers sponsoring the plans) need to begin compiling the information that is required to be provided to participants by August 30, 2012. Some of this information will come directly from the disclosures provided by covered service providers. For example, with respect to designated investment alternatives, covered service providers are required to disclose the total annual operating expenses, calculated in accordance with the participant disclosure regulations. Plan administrators should keep in mind that, although the covered service providers are required to provide much of the information that is to be passed along to participants, the plan administrators have the ultimate responsibility to provide the required fee information to participants.

Plan administrators must take time to analyze the information that will be disseminated to participants. In addition, plan administrators should anticipate participant questions and be ready to respond on short notice once the disclosures are delivered.

Finally, plan administrators need to gear up to deliver the quarterly notices. The first quarterly notice is due by November 14, 2012.

Tags: ERISA Plan Administration
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Photo of Monique Warren Monique Warren

Monique Warren is a Principal in the White Plains, New York office of Jackson Lewis P.C. Ms. Warren is a member of the Employee Benefits Counseling, Executive Compensation, Benefits Litigation and Workplace Privacy Practice Group.

Ms. Warren counsels employers on employee benefits compliance…

Monique Warren is a Principal in the White Plains, New York office of Jackson Lewis P.C. Ms. Warren is a member of the Employee Benefits Counseling, Executive Compensation, Benefits Litigation and Workplace Privacy Practice Group.

Ms. Warren counsels employers on employee benefits compliance and administrative matters, drafts plan documents and employee communication materials, and represents employers to government agencies and in employee benefit litigation. Her expertise includes health and welfare plans as well as retirement plans.

Ms. Warren has spoken at numerous client and professional association events including SHRM and WEB meetings. She also has presented numerous seminars on employee benefits compliance topics including benefits basics for human resource professionals, HIPAA privacy and security, 409A requirements, and annual legal updates.

Prior to joining the firm in 2006, Ms. Warren was a member of the employee benefits group of a large Chicago law firm and later maintained her own practice in Illinois, representing employers in employee benefits, employment and employment-related immigration matters. While attending law school, she was an intern in the tax clinic at Loyola University Chicago School of Law and was a judicial extern for the Honorable Blanche Manning, Federal District Court, Northern District of Illinois. As a law student, she received academic honors and was a member of the moot court employment law team.

During the ten years prior to attending law school, Ms. Warren directed human resource functions in manufacturing and research enterprises. She was certified as a Senior Human Resource Professional by SHRM in 1996.

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Photo of Melissa Ostrower Melissa Ostrower

Melissa Ostrower is Principal in the New York City office of Jackson Lewis P.C.

Ms. Ostrower advises companies on all aspects of employee benefits law, including compliance with ERISA and the Code as well as administrative matters and fiduciary issues relating to benefit…

Melissa Ostrower is Principal in the New York City office of Jackson Lewis P.C.

Ms. Ostrower advises companies on all aspects of employee benefits law, including compliance with ERISA and the Code as well as administrative matters and fiduciary issues relating to benefit plans.  Ms. Ostrower has extensive experience in executive compensation matters and counsels both public and private companies on executive compensation issues, including Section 409A and 162(m) of the Code.

Ms. Ostrower is also a member of the Jackson Lewis healthcare reform task force and is intimately involved in helping Jackson Lewis clients ensure compliance with recently enacted healthcare reform legislation.

Ms. Ostrower is a graduate of Brandeis University (B.A., M.A.), George Washington University Law School (J.D.) where she was a member of The Law Review, and New York University (LL.M.).

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