ERISA COVID-19 Disaster Relief Includes Fiduciary Relief for Notices to Plan Participants and Beneficiaries

In addition to the relief detailed in our recent article on EBSA Disaster Relief Notice 2020-01, the U.S. Department of Labor (DOL) in Notice 2020-01 extended a number deadlines for furnishing required notices or disclosures to plan participants, beneficiaries, and other persons.  This will provide additional time for plans and responsible fiduciaries to meet their obligations under Title of I ERISA during the COVID-19 outbreak.

Under Notice 2020-01, a plan fiduciary will not violate ERISA by failing to furnish a notice, disclosure, or document that was otherwise required to be furnished between March 1, 2020 and 60 days after the announced end of the COVID-19 national emergency. To qualify for this protection, the responsible fiduciary must act in good faith and furnish the applicable notice, disclosure, or document as soon as administratively practicable under the circumstances.

Significantly, “good faith” action includes the use of alternative electronic means of communicating with plan participants and beneficiaries whom the plan fiduciary reasonably believes have effective access to electronic methods of communication, including email, text messages, and continuous access websites.  The guiding principle for plans must always be to act reasonably, prudently, and in the interest of the covered workers and their families who rely on their health, retirement, and other employee benefit plans for their physical and economic wellbeing.

This guidance provides relief from the current electronic disclosure safe harbor under ERISA, which was adopted in 2002.  This general rule permits electronic disclosure to only two categories of individuals:  (1) participants who are “wired at work”—thus having effective access to the plan sponsor’s electronic information system as an integral part of their duties as employees; and (2) participants, beneficiaries, and other persons who affirmatively consent to receive documents electronically.

The temporary relaxation of the electronic notice/disclosure requirements is welcomed relief to responsible plan fiduciaries, facing greater challenges in communicating with plan participants. It is important to reiterate, however, that the relief granted by the DOL in this Notice is limited in scope and applies only through 60 days after a declaration that the present national emergency has ended.

Visit our COVID-19 Resource Center often for up-to-date information to help you stay informed of the legal issues related to COVID-19.

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