If you are a member of the committee for your employer’s pension, 401(k), profit-sharing, or 403(b) plan, you should check out a set of proposed rules for selecting investments. If you have an outside investment advisor, as you probably should, they should be bringing these proposals to your attention. This process of the DOL’s presents a good opportunity to look at your plan’s procedures to assure that you and your advisor are both meeting your fiduciary responsibilities.

The Notice outlining the background and contents of the proposed rules can be found on the DOL’s website.

THE NOTICE ADDS FIVE CORE PRINCIPLES FOR FIDUCIARIES:

• New regulatory text to codify the Department’s longstanding position articulated in interpretive bulletins (IBs) published in 1994, 2008, and 2015 that ERISA requires plan fiduciaries to select investments and investment courses of action based on financial considerations relevant to the risk-adjusted economic value of a particular investment or investment course of action.
• An express regulatory provision stating that compliance with the exclusive purpose (loyalty) duty in ERISA section 404(a)(1)(A) prohibits fiduciaries from subordinating the interests of plan participants and beneficiaries in retirement income and financial benefits under the plan to non-pecuniary goals.
• A new provision that requires fiduciaries to consider other available investments to meet their prudence and loyalty duties under ERISA in furthering the purposes of the plan.

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