Do I have liability regarding sending notices?

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You do indeed.

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As the plan sponsor and/or plan administrator of your company-provided retirement, you have a fiduciary obligation to communicate with all your participants. In early 2021, the Department of Labor (DOL) announced best practices regarding communication with plan participants and recommended processes to find "missing participants." In essence, the DOL clarified the plan sponsor's and administrator's roles and designated them as the parties responsible for ensuring notices were delivered.

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Before the 2021 best practices release, the question of who was responsible for noticing was debatable. For example, once, you could have argued that if participants didn't maintain their personal contact information, they would have some culpability if they didn't receive their notices. However, the new guidance eliminated any gray area around responsibility and clarified that plan sponsor were now required to follow a detailed process to ensure that participants receive their communications.

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With this new clarity, it is essential for all plan sponsors, plan administrators, and committees to develop and strictly adhere to executable processes related to distributing all required participant notices. In addition, in the case of a DOL, IRS, or plaintiff attorney inquiry, you must be able to produce proof of distribution and all follow-up documentation proving that attempts were made per the DOL's guidelines.

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Don't hesitate to get in touch with us if you're interested in ways that Plan Notice can support you in this process. Our role is to take on the noticing responsibility and keep your plan fully compliant with the new DOL rules.

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Additionally, when Plan Notice is engaged, we accept total financial liability related to these noticing responsibilities.

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