In response to an executive order directing the agency to lighten regulatory burdens on retirement plans, the Department of Labor (DOL) proposed new rules regarding electronic delivery of retirement plan documents and disclosures. Under the current rule, plans by default must send retirement materials through the mail. Plans can only send documents electronically if the participant has affirmatively consented, or alternatively, if the participant accesses an electronic information system as an integral part of his or her work duties.
Under the proposed rule, retirement plans would be able to default to an electronic “notice and access” system in order to provide materials to participants. This system involves a plan posting a document on a website and then informing participants that the document is newly available with an electronic “notice of internet availability.” The notice must include certain information about the document and the participant’s rights.
Plans may only default to this electronic delivery with participants who have provided an “electronic address,” like an email address or smartphone number. If a participant has provided an electronic address but would rather have the documents on paper, he or she must affirmatively opt-out of electronic delivery.
According to the DOL, plans would save $2.4 billion over the next 10 years on printing and mailing costs using this electronic system.