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ARA Makes Suggestions on Electronic Disclosure, Required Notices


The American Retirement Association (ARA), in a Dec. 12 letter to Joe Canary, Director of the Office of Regulations and Interpretations of the DOL’s Employee Benefits Security Administration, has suggested steps the agency can take to improve retirement security.

The ARA sent the letter as part of its continuing response to President Trump’s Aug. 31 executive order on expanding access to workplace retirement savings plans. The president had directed the Secretary of Labor to provide input on making retirement plan disclosures more understandable and useful for participants and beneficiaries, while also reducing the costs and burdens they impose on employers and other plan fiduciaries responsible for their production and distribution.

Increase Electronic Disclosure

The ARA continues to urge the DOL to modernize its existing regulations regarding delivery of ERISA-required notices that takes advantage of “the dramatic and advantageous evolution in technology, and its expanding availability over the past decade, to the benefit of plan participants.” The ARA argues that “Doing so would be consistent with the President’s directive to make disclosures more useful to plan participants and less costly and burdensome to plan sponsors and fiduciaries” and says that it strongly believes that allowing electronic delivery as the default method for communicating with participants and beneficiaries — while still allowing paper delivery — will:

  • Enhance the effectiveness of ERISA communications, particularly to individuals with disabilities or for whom English is not the primary language;
  • Produce significant cost savings for 80 million retirement plan participants and beneficiaries;
  • Maintain security of information; and
  • Reduce the environmental impact of tons of discarded paper every year.

Reduce Number of Notices

The ARA recommends that the DOL reduce the number of times plan sponsors must send notices to participants, to the extent possible by:

  • eliminating redundant and ineffective notices;
  • coordinating the timing of required notices; and
  • permitting notices to be combined.

Doing so, the ARA argues, “can significantly reduce the costs and burdens of maintaining a retirement plan.”

Simplify Content of Required Notices

In addition to reducing the number of notices, the content requirements of the required notices should be simplified, the ARA asserts. Participants could more easily understand shorter, more pointed notices, the ARA contends; in addition, it points out that shorter notices also would be less expensive to prepare and distribute — which would reduce the costs and burdens of maintaining the plan.