The Employee Benefits Security Administration of the Department of Labor (the "DOL") announced today, that tomorrow it will be publishing information regarding a new "safe harbor" that ERISA plan administrators can use for providing certain required disclosures through electronic media. If the proposal is adopted, it would allow plan administrators to notify participants and beneficiaries that certain disclosures may be found online. This would greatly enhance the efficiency of ERISA disclosures and reduce the expenses to employers for paper mailings.
Rather than sending lengthy paper documents through the mail, the new safe harbor would allow plan administrators to post legal disclosures on a website and notify plan participants and beneficiaries that the information is available on the website, including instructions on how to access the disclosures and their right to receive paper copies of the disclosures. The proposal includes standards for the website where the disclosures are posted. The proposed new safe harbor is in addition to previous electronic media disclosure rules, giving employers additional options for disclosing required information.
Participants and beneficiaries will have the option to opt out of electronic delivery and elect to receive the disclosures in paper form. In addition, before administrators can default to providing disclosures electronically, they must first notify participants and beneficiaries by paper of the ability to opt for paper disclosures.
The intent of the new safe harbor is to improve the effectiveness of employee benefit plan disclosures and reduce the costs and burden associated with furnishing the disclosures. The DOL expects the expanded use of internet technology will save employers $2.4 billion over the next 10 years. Interested parties are invited to provide additional information to the DOL regarding how to improve the proposed safe harbor or the general disclosure.
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