Relief for Distributing Summary Plan Descriptions

“It just happens that 2020 is the year that our Employee Retirement Income Security Act (ERISA) 403(b) plan must issue summary plan descriptions (SPDs) to plan participants (it has been five years since we last distributed SPDs, and plan amendments have been made). I am starting to worry about completing this task in 2020, since both our plan and its recordkeeper are currently not in a position to complete such a large-scale distribution due to the COVID-19 pandemic, and it is looking more and more like that situation may not change until 2021. If this is the case, is there any alternative course of action we can pursue?”

Stacey Bradford, Charles Filips, David Levine and David Powell, with Groom Law Group, and Michael A. Webb, vice president, Retirement Plan Services, Cammack Retirement Group, answer:

You’re in luck! The Employee Benefit Security Administration (EBSA) Disaster Relief Notice 2020-01 specifically addresses this issue. That notice extends the deadline for distribution of your SPDs to 60 days after the announcement of the end of the COVID-19 National Emergency or such other date announced by the Department of Labor (DOL) in a future notice. However, it should be pointed out that this relief is only available to plan sponsors who act in good faith and furnish the SPDs as soon as administratively practicable under the circumstances. Good faith acts include use of electronic alternative means of communicating with plan participants and beneficiaries who the plan fiduciary reasonably believes have effective access to electronic means of communication, including email, text messages, and continuous access websites. Thus, if there are participants/beneficiaries to whom you or your recordkeeper can provide the SPD electronically in 2020 (e.g. because you have a valid email address on file for that participant), you should do so.

Although SPDs qualify for the electronic delivery relief under EBSA Disaster Relief Notice 2020-01, plan administrators must still comply with the initial notice requirement under the DOL’s new safe harbor on e-disclosure. See our recent post on the initial notice here.

NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.