EBSA Rejects Requested Delay as Proposed Fiduciary Rule Moves Forward

The U.S. Department of Labor’s (DOL) Employee Benefits Security Administration issued a letter rejecting a request for delays in the rulemaking process concerning the expansion of the definition of “fiduciary” under the Employee Retirement Income Security Act (ERISA). The Securities Industry and Financial Markets Association (SIFMA), American Retirement Association (ARA), and various other financial groups previously sent a joint letter to EBSA, requesting that the agency extend the comment period and delay the public hearing regarding the proposed fiduciary rule.

Soon after financial groups published the rejection letter, signed by DOL Assistant Secretary and EBSA head Lisa M. Gomez, in an online forum, EBSA announced a three-day public hearing to occur virtually from December 12 – 14, 2023. In the letter, Secretary Gomez noted that EBSA did not intend to extend the comment period or delay the public hearing concerning the proposed fiduciary rule.

In their joint letter, SIFMA, ARA, and other financial groups suggested that EBSA adopt a regulatory framework like the one used in a previous attempt to amend the definition of “fiduciary” in 2016. Under that framework, EBSA allowed a 75-day comment period, followed by a 15-day extension, and after the public hearing, another 15-day comment period.

A spokesperson for ARA was critical of EBSA’s rejection letter, stating that although EBSA has had significant input from the public and stakeholders since 2010, the financial industry was unaware of the contents of the proposed final rule until October 31, 2023. Therefore, stakeholders could only respond to the complete proposed rule very recently. The DOL has pushed back against the immediate criticism from financial groups after it unveiled its proposed rule in late October, suggesting that the groups use the comment period to express their concerns.

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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