For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.
Compliance November 12, 2020
DOL Announces Final Rule on PEP Registration
The rule is in line with DOL’s proposed rulemaking that it announced in August and streamlines the electronic process by using the same system as the Form 5500.
Reported by Lee Barney
The Department of Labor (DOL)’s much anticipated final rule on registration requirements for pooled employer plans (PEPs), pursuant to the Setting Every Community Up for Retirement Enhancement (SECURE) Act, has just been announced.
The SECURE Act amended the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code (IRC) to establish PEPs. These plans are administered by pooled plan providers (PPPs).
“Pooled employer plans will give employers, especially small, unrelated employers, a way of offering their employees a workplace retirement savings option with reduced burdens and costs,” said Acting Assistant Secretary of Labor for the Employee Benefits Security Administration (EBSA) Jeanne Klinefelter Wilson. “This final rule lays the groundwork for a sensible registration process so that providers can get pooled plans up and running.”
PEPs may start operating on January 1, 2021, but their pooled plan providers must first register with the secretary of labor and the secretary of the Treasury at least 30 days prior, which they can do electronically by submitting the new EBSA Form PR. The new electronic filing system will be available starting November 25 at www.efast.dol.gov/. Sometime within the coming days, an informational version of the new Form PR and instructions will be made available at www.dol.gov/agencies/ebsa.
However, between November 25 and January 31, the requirement to register at least 30 days prior to operating a PEP is waived, provided registration occurs no later than the start of the plan.
Plans must also submit supplemental filings regarding specific reportable events and a final filing after the provider’s last PEP has been terminated and ceased operations.
The DOL first announced its Notice of Proposed Rulemaking (NPRM) on these registration requirements in August. The proposal said the EBSA believes the most efficient approach is to integrate the Form PR registration filing process into the current electronic filing system that employee benefit plans use to file their Form 5500 Annual Return.