The Department of Labor (DOL) proposed to amend its final participant-level disclosure regulation to extend the transition provision to allow employers sufficient time to obtain information from service providers. The final rule applies to plan years beginning on or after November 1, 2011 and requires employers to disclose information concerning plan and investment costs to participants. The final rule includes a 60-day transition provision, which the DOL proposes to extend to 120 days. When finalized, the proposed amendment would allow employers 120 days to furnish initial disclosures to participants. Under the proposed rule, the first participant-level fee disclosures for calendar-year plans would be required on or before April 30, 2012.
The DOL also issued a proposed notice to delay the effective date of interim final regulations under ERISA section 408(b)(2), which require retirement plan service providers to disclose comprehensive information about fees and potential conflicts of interest to plan fiduciaries. The interim final rules were scheduled to apply to plan contracts for services in existence on or after July 16, 2011. The DOL previously announced its intention to extend this deadline to January 1, 2012, and the extension will be official when the proposed rule is finalized.
The DOL notes that these extensions will ensure that service providers and employers have the time needed to comply with the disclosure requirements following the publication of the final rule.