DOL Rules on ESG Factors

The Department of Labor (“DOL”) has issued updated guidance on fiduciary issues related to the investment of plan assets and the pendulum has swung back in the other direction. The saga began back in 2020 after the DOL published a final rule which limited the ability of fiduciaries to consider, environmental, social, and corporate governance (i.e., “ESG”) issues when making investment decisions with plan assets. Under this rule, fiduciaries...

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Plans Now Required to Cover Over-the-Counter COVID Tests

On January 10, 2022, the Biden administration suddenly announced that health plans and insurers must begin covering the cost of over-the-counter (“OTC”) COVID-19 tests by January 15, 2022. The three federal agencies mostly responsible for overseeing this process are the Departments of Health and Human Services, Treasury, and Labor (i.e., the “Joint Agencies”). Since the January 10th announcement, the Joint Agencies have released two FAQs aimed at addressing questions...

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IRS Issues Updated Retirement Plan and IRA Limits for 2022

The IRS released updated 2022 annual limits for retirement plans and Individual Retirement Accounts (“IRAs”). These limits, which are updated each year, impact all retirement plans (both defined contribution and defined benefit) and IRAs (both Traditional and Roth) and are crucial in plan administration and proper tax reporting. The following summary highlights some of the changes for 2022. Retirement Plan Limits

  2022 Limit 2021 Limit Change
Maximum...

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How Far Does Withdrawal Liability Extend? Local 705 International Brotherhood of Teamsters Pension Fund v. Pitello

Employers often ask how far withdrawal liability extends? Does it include other business entities owned by the same company? What about property those other entities own? On July 7, 2021, the Seventh Circuit decided in Local 705 International Brotherhood of Teamsters Pension Fund v. Pitello that withdrawal liability can reach affiliated trades or businesses that are under “common control” with the withdrawing employer, including any real estate owned by...

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Zirbel v. Ford Motor Company – Benefit Overpayment Decision Upheld in the Sixth Circuit

Incompetent Board of Trustees is not a defense. Benefit overpayment cases having been trending across the country. One of the latest was heard by the Sixth Circuit Court of Appeals in Ohio. In Zirbel v. Ford Motor Company, the appeals court upheld the Ford retirement plan’s decision on a benefit overpayment mistakenly paid to an ex-spouse of a participant. In this case, Donna Zirbel received a $351,000 retirement-benefits payment from...

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The IRS Gives Defined Benefit Plans Two New Options to Address Overpayment

Mistakes are a fact of life and administering a pension plan is no different. In fact, the average pension plan is full of landmines that can create potential problems, most notably the accuracy of plan data, benefit calculations, and accrual computations. That is why the IRS created the Employee Plans Compliance Resolution System, or “EPCRS,” to help plan sponsors proactively address and correct any mistakes or errors they encounter. Recently,...

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Department of Labor Dials Back ESG Investing Regulations

The Department of Labor has issued its final rules on the investment duties of fiduciaries under the Employee Retirement Income Security Act (“ERISA”). These rules differed from the proposed rules issued over the summer which required additional responsibility for retirement plans who wanted to consider environmental, social, or governance factors in their investing (known as “ESG” investments). This is of particular concern to Taft-Hartley Plans, who often include investment...

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Defined Benefit Plan Participants Must Have “Standing” to Sue Plan Fiduciaries

Can a participant in a defined benefit plan sue the plan’s fiduciaries under ERISA without first showing an individual financial loss or an imminent risk of such harm? The Supreme Court of the United States recently decided the question in the negative, holding a participant must have “standing” to bring suit. That means the participant must show that he or she suffered an actual injury or have...

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Abuse of Discretion – ERISA’s Standard of Review You Do Not Want to Lose

When a court reviews the decision of an ERISA plan (both health and welfare and pension plans), it must first determine the standard of review: abuse of discretion or de novo. Under an abuse of discretion standard, the court gives the plan’s sponsor (or trustees) more deference and looks at whether the decision was reasonable under the plan’s terms and available evidence. The court will also pay...

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How many Non-Bargaining Employees is Too Many?

A Multiemployer Plan under the Employee Retirement Income Security Act (“ERISA”) is a plan in which one or more employers contribute, is maintained pursuant to one or more collective bargaining agreements between one or more employee organizations and one or employer, and satisfies other requirements set forth by the United States Department of Labor. However, and despite this definition, you will often find non-bargaining employees covered under...

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