Verrill Dana Employee Benefits attorneys Eric Altholz and Chris Lockman provide a brief update on class action lawsuits alleging various breaches of fiduciary duties under ERISA pending against a dozen major universities. All of these lawsuits are related to the administration of the 403(b) plans maintained by the universities, but these issues are not limited to higher education institutions. Tax-exempt employers, including health care organizations, whose 403(b) programs may include multiple vendors and a large number of investment options should reduce the risk of “analysis paralysis” and high fees that may result from offering a large number of vendors and funds. In this podcast, Eric and Chris offer thoughts about how retirement plan fiduciaries can assess and improve their practices regarding the investment of plan assets in 403(b) and 401(k) plans.
Eric Altholz, Vice Chair of Verrill Dana's Employee Benefits and Executive Compensation group, has been named 2017 Portland, Maine Employee Benefits (ERISA) Law "Lawyer of the Year” by Best Lawyers®. Eric is the latest member of the group to be recognized as Lawyer of the Year in the group's home market, following in the footsteps of Lisa Boehm (2015), Suzanne Meeker (2013), and Gregg Ginn (2011). Verrill Dana, LLP is a regional law firm serving clients nationally from offices in Portland and Augusta, ME; Boston, MA; Providence, RI; and Westport, CT. With nine lawyers devoted exclusively to the practice area, Verrill Dana's Employee Benefits and Executive Compensation group is among the largest in New England.
Proposed Regulations Create (Some) Executive Compensation Design Opportunities for Tax-Exempt Employers
It has been a long time coming (nine years to be exact), but the Treasury Department has at last published proposed regulations that harmonize important concepts governing deferred compensation arrangements under Code Section 409A and Code Section 457. The proposed regulations contain no major surprises that would shake up the world of deferred compensation for tax-exempt employers. But the proposed regulations do provide important new rules under Code Section 457 that: (1) explain the meaning of “substantial risk of forfeiture”; (2) develop existing regulations regarding plans that are not subject to Code Section 457; and (3) help calculate amounts to be included in income under the Code Section 457 tax regime. The new proposed regulations provide greater clarity regarding these important concepts and can be said to offer new opportunities to tax-exempt employers in designing certain types of executive compensation arrangements (or perhaps, more accurately, resurrect design elements that have fallen into disuse).
Last week the Equal Employment Opportunity Commission (EEOC) issued final rules for wellness programs under both the Americans with Disabilities Act (ADA) (the “Final ADA Rule”) and the Genetic Information and Nondiscrimination Act (GINA) (the “Final GINA Rule”).
Part I of this two-part series addressed the Final ADA Rule. In Part II, we discuss the Final GINA Rule. Like the Final ADA Rule, the Final GINA Rule is generally consistent with the proposed rule published by the EEOC in October 2015. The Final GINA Rule simply clarifies the type of information regulated by the rule and the level of financial incentives that may be offered by an employer in exchange for certain health information about an employee’s spouse and children.
The Equal Employment Opportunity Commission (EEOC) has issued final rules for wellness programs under both the Americans with Disabilities Act (ADA) (the “Final ADA Rule”) and the Genetic Information and Nondiscrimination Act (GINA) (the “Final GINA Rule”). The release is accompanied by Frequently Asked Questions posted to the EEOC website, as well as interpretive guidance discussing the Final ADA Rule. Employers must comply with both sets of rules as of the first group health plan year that begins on or after January 1, 2017. Despite a torrent of highly critical comments submitted during the comment period and ongoing litigation surrounding the EEOC’s interpretation of the limits imposed on wellness programs by the ADA and GINA, the final rules differ very little from the proposed rules and continue to depart in significant ways from the final regulations issued by the Department of Labor, Department of the Treasury, and the Department of Health and Human Service under the Health Insurance Portability and Accountability Act (HIPAA) (the “Final HIPAA Regulations”). In this two part series, we discuss the differences between the proposed and final versions of each rule and highlight changes that may be required to existing wellness programs. Part I concerns the Final ADA Rule.