More retirement-related regulatory news for plan sponsors, including links to detailed information.
Proposed rule on joint employer status under FLSA issued
The U.S. Department of Labor (DoL) announced a proposed rule to revise and clarify the responsibilities of employers and joint employers to employees in joint employer arrangements. The DoL has not meaningfully revised its joint employer regulation since 1958.
The Fair Labor Standards Act (FLSA) allows joint employer situations where an employer and a joint employer are jointly responsible for the employee’s wages. This proposal would ensure employers and joint employers clearly understand their responsibilities to pay at least the federal minimum wage for all hours worked and overtime for all hours worked over 40 in a workweek.
The DoL proposes a clear, four-factor test—based on well-established precedent—that would consider whether the potential joint employer actually exercises the power to:
• Hire or fire the employee
• Supervise and control the employee’s work schedule or conditions of employment
• Determine the employee’s rate and method of payment
• Maintain the employee’s employment records.
For more information, click here.
PBGC offering a prefiling consultation for ERISA 4010 filers
The Pension Benefit Guaranty Corporation (PBGC) now offers a prefiling consultation for ERISA 4010 filers, especially first-time filers looking for guidance on filing requirements. PBGC staff will provide an overview of the process, share helpful tips on how to use the e-filing software, and provide insights on how to avoid common filing errors.
To schedule a prefiling consultation, send an email to [email protected] or call (202)-326-4000 ext. 3075.
New GAO report explores phased retirement for older workers
In response to an aging workforce, countries around the world have developed policies to encourage older workers to work longer to improve the financial sustainability of national pension systems and address shortages of skilled workers. Phased retirement is one option that can be used to encourage older workers to stay in the workforce. The Government Accountability Office (GAO) was asked to look at phased retirement programs in the United States and other countries. In June 2017, GAO issued a report (GAO-17-536) that looked at phased retirement in the United States, where formal phased retirement programs are as yet uncommon. This report looks at phased retirement in other countries.
Specifically, GAO examined (1) the extent to which phased retirement exists in other countries with aging populations, (2) the key aspects of phased retirement programs in selected countries, and (3) the experiences of other countries in providing phased retirement and how their experiences can inform policies in the United States.
GAO analyzed relevant data, reviewed academic research, and conducted interviews to identify countries with phased retirement, and selected four countries with national policies permitting phased retirement programs with broad coverage for case studies. GAO also conducted interviews with government officials, unions, employer associations, and other experts.
To download the entire report, click here.
New CRS report on retirement savings contribution credit
The 116th Congress has shown interest in advancing policies that support retirement savings and retirement security. One provision designed to encourage retirement savings for low-income workers is the Retirement Savings Contribution Credit, or the Saver’s Credit (Internal Revenue Code [IRC] §25B). In a new report, the Congressional Research Service (CRS) provides an overview of the credit and provides a brief discussion of the credit’s effectiveness, in the context of various policy options that might be considered in the 116th Congress.
To download the report, click here.