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Release Date: July 22, 2008
Release Number: 08-991-NAT
Contact Name: Gloria Della/Richard Manning
Phone Number: 202.693.8664/202.693.4676
Washington – The U.S. Department of Labor
today announced a proposed rule that will make it easier for an
estimated 65 million participants covered by 401(k)-type plans to make
informed retirement savings decisions. The proposal would provide
workers with useful summary information, including fee and expense
information, for investment options available under their plans.
“Our proposal is consistent with public consensus
that workers need clear and concise information, not dozens of pages of
‘legalese,’ about the investment options available under their
plans, and that they would benefit greatly from having that information
in a comparative format,” said U.S. Secretary of Labor Elaine L. Chao.
“One of the department’s top priorities is improved disclosure to
workers that will give them the information they need to make informed
investment decisions.”
The centerpiece of the proposed regulation is a
requirement to provide investment-related information in a comparative
chart or similar format. As part of the proposal, the department has
developed a model chart for complying with this requirement, while
giving plan fiduciaries the flexibility to design their own charts or
comparative formats. The proposal would also require plan fiduciaries to
disclose basic information about the plan and its investment options,
such as what options are available under the plan, how to give
investment instructions, investment returns and fees and expenses, and
how to obtain more detailed information. This information would be given
to participants on a regular and periodic basis.
In addition, the department is proposing conforming
changes to its regulation under section 404(c) of the Employee
Retirement Income Security Act.
“We want to help workers make the most of their
401(k)-type plans by ensuring that they are provided the information
they need to make wise investment decisions,” said Bradford P.
Campbell, assistant secretary for the Labor Department’s Employee
Benefits Security Administration.
When finalized, the proposed regulation would be
effective for plan years beginning on or after January 1, 2009. Comments
on the proposed regulation should be directed to the U.S. Department of
Labor, Employee Benefits Security Administration, Room N-5655, 200
Constitution Ave. N.W., Washington, D.C. 20210, Attention: Participant
Fee Disclosure Project; electronically to e-ORI@dol.gov or via
www.regulations.gov. The proposal is scheduled to be published in the
July 23, 2008 edition of the Federal Register.
U.S. Department of Labor news releases are accessible on the
Department's Newsroom
page. The information in this news release will be made available
in alternate format (large print, Braille, audio tape or
disc) from the COAST office upon request. Please specify which news release when
placing your request at 202.693.7828 or TTY 202.693.7755. The Labor Department is committed to providing America's employers and
employees with easy access to understandable information on how to comply
with its laws and regulations. For more information, please visit the
Department's Compliance
Assistance page.
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