On August 31, 2018, President Trump signed an Executive Order which directed the Department of Labor (the "DOL") and the Department of Treasury to consider regulations or guidance that would expand the availability of multiple employer plans ("MEPs"). A MEP is a type of retirement plan (e.g., a 401(k) plan) that different businesses can create by joining together and pooling their resources so as to ultimately reduce provider fees. The DOL has now released the text of the proposed regulations which are designed to accomplish such.
Historically, the DOL tried to limit the circumstances under which groups of employers could safely access the advantages of participating in a MEP. The proposed regulations clarify that employers may band together into employer groups or professional employer organizations ("PEOs") to sponsor a retirement plan if they meet certain requirements. Importantly, the MEP sponsor (e.g., the employer group, PEO, etc.) – not the individual participating employers – would generally be responsible, as the ERISA "plan administrator", for compliance with certain ERISA reporting and disclosure requirements and fiduciary obligations.
