A new U.S. Department of Labor regulatory effort could impact retirement plans by requiring them to monitor whether plan members access electronic communications, a cost that may be passed on to consumers.
Chair of the Education and the Workforce Committee, U.S. Rep. Virginia Foxx, R-N.C., sent a letter Thursday to the Employee Benefits Security Administration raising concerns about the federal agency’s Request for Information, a document suggesting the agency will add more regulatory burden onto retirement accounts.
More regulations could mean more fees and higher costs for some Americans with retirement plans.
“The RFI includes several questions targeting the paper statement requirement enacted in section 338 of SECURE 2.0,” said the letter to EBSA Assistant Secretary Lisa Gomez. “These RFI questions contemplate amendments to DOL regulations well beyond the provisions of section 338. Congress’ directives to the Secretary of Labor in section 338 are clear, specific, and intentionally limited. This letter is intended to remind DOL of its obligation to comply with the statutory provisions of section 338, as limited by Congress.”
The rule in question came after Congress passed SECURE 2.0 last year, a bill that made several legal changes to encourage employers and employees to build retirement accounts.
Foxx said the federal government’s interpretation of that law, though, may go too far, adding unnecessary regulatory burdens.
“RFI Question 21 contemplates additional, and very significant, regulatory requirements not authorized by Congress,” the letter said. “Question 21 asks, ‘should [DOL’s electronic delivery guidance] be modified such that their continued use by plans is conditioned on access in fact?’ To require a plan administrator to monitor electronic access is as ridiculous as requiring a plan administrator to confirm that a participant opens and reads paper mail.
“This is an insult to participants and gross regulatory overreach,” the letter adds.
