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EB Flash: Proposed Rules to Permit E-Delivery of Certain Retirement Plan Disclosures

Employee Benefits Alert

The Employee Benefits Security Administration (EBSA) today issued long-awaited proposed regulations that would permit an "opt-out" electronic delivery method of certain retirement plan disclosures through a "notice-and-access" style of e-delivery. The proposed regulations would serve as an alternative to the existing safe harbor in 29 CFR 2520.104b-1 from 2002 that generally encompasses all ERISA Title I disclosures, including those for health and welfare plans. 

In general, the proposed regulations would:

  • Apply only to certain retirement plan disclosures, not to group health plan disclosures;
  • Make e-delivery the default method (i.e., an opt-out approach) for all covered participants and beneficiaries, including those who do not have access to the electronic documents as an integral part of their jobs (i.e., those who are "wired at work"); and
  • Allow a "notice-and-access" style of delivery, generally by e-mailing participants and beneficiaries a "notice of internet availability" that signifies the purpose and importance of the disclosure and includes:
    • A brief description of the disclosure;
    • A website address linking directly to the covered document (log-in access is permitted);
    • Instructions for requesting a free paper copy;
    • Instructions for electing paper delivery in the future; and
    • A telephone number for the administrator or other designated representative.

In addition, the proposed regulations would require plan administrators to, among other things:

  • Provide each participant and beneficiary with an initial notification of default e-delivery and the right to obtain paper disclosures;
  • Comply with specified standards for maintaining the website and ensuring that disclosures remain available until superseded by a subsequent version; and
  • Take reasonable steps to ensure receipt of the materials if, for example, emails are returned as undeliverable.

The proposed e-delivery alternative would cover "any document that the administrator is required to furnish to participants and beneficiaries pursuant to Title I of [ERISA], except for any document that must be furnished upon request."1 These include:

  • A summary plan description
  • A summary of material modifications;
  • A summary annual report;
  • An annual funding notice;
  • An investment related disclosure under 29 CFR 2550.404a-5(d);
  • A qualified default investment alternative notice; and
  • A pension benefit statement. 

The rules solicit public comment on all aspects of the proposal, including specific questions covering a broad range of disclosure-related topics regarding scope, content, design and delivery. EBSA hopes to use this input to determine if additional changes should be made in the future, including potentially expanding application of e-delivery to other disclosures.

EBSA proposes that the new alternative method for disclosure through e-delivery will be effective 60 days following publication of a final rule in the Federal Register. The new safe harbor is proposed to apply to benefit plans on the first day of the first calendar year following the publication of the final rule in the Federal Register.

The 115-page text of the proposed rules is posted here. The rulemaking is scheduled for official publication tomorrow in the Federal Register.

A five-page DOL Fact Sheet on the proposed rules is posted here.

A DOL press release announcing the new rules is posted here


1 Under existing DOL regulations, a plan administrator satisfies its obligation to furnish these documents if it uses measures "reasonably calculated to ensure actual receipt of the material," and provides the disclosures by a "method or methods of delivery likely to result in full distribution." DOL Reg. 2520.104b-1(b)(1). For example, in-hand delivery of the materials to employees at their worksites, or delivery by first-class mail, would be acceptable, whereas it would never be sufficient merely to provide copies of the materials in an area frequented by participants, such as an employee break room. Id. It should be noted that while the e-delivery safe harbors provide comfort in the case of materials that are sent via e-delivery, the safe harbors are just that and not the exclusive means for complying with ERISA’s disclosure obligations.

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