By now you should’ve received fee disclosures from your retirement plan providers (they were due to plan sponsors by July 1). But if you didn’t, or you don’t like what you’ve seen, here’s what you’re required to do.
If your provider came up short and failed to give you what you needed to pass all the fee data on to your employees, you’ve got to speak up — and you have a new place to do it.
New DOL final fee disclosure rule
The Department of Labor (DOL) just published a new fee disclosure rule changing the mailing and email addresses you should use to give notice a provider failed to provide fee data to you:
- If notifying via snail mail, use: U.S. Department of Labor, Employee Benefits Security Administration, Office of Enforcement, P.O. Box 75296, Washington, DC 20013
- If notifying electronically, visit: Dol.gov/ebsa/regs/feedisclosurefailurenotice.html
Remember, if you don’t get the required fee disclosure info from your provider, you have to request it.
Plan sponsors have until Aug. 31 to create and distribute retirement plan fee disclosure documents to participating employees.
Are the fees ‘reasonable’?
For those of you whose providers have coughed up the fee info, it’s now up to you to determine whether those fees are “reasonable.”
Sites like BrightScope.com, which rates 401(k) plans, can help you determine if your retirement plan and its fees are in line with other offerings out there. You’ll want to benchmark as much as possible.
If you find your plan lagging in some areas, then the real work begins. The DOL’s made it clear you can’t continue with a plan that’s charging excessive fees, so you’ll have to start shopping for a new, lower-cost plan provider pronto.
Dealing with employee fallout
Chances are, even if your plans fees are reasonable, it’ll come as a shock to many employees that they’re paying anything at all.
For ideas on how to best break the news to employees, check out the best practices HR Morning laid out this past spring for communicating 401(k) fees to employees.