On Monday, Department of Labor proposed a new rule to allow small businesses to pool together to offer workers retirement plans. This can be seen as direct response to the executive order signed by President Trump on August 31st. Here is what experts had to say about the newly proposed rule and its impact on retirement plans:
Labor Secretary Alexander Acosta:
“Many small businesses would like to offer retirement benefits to their employees, but are discouraged by the cost and complexity of running their own plans. Association Retirement Plans give these employers a simple and less burdensome way to offer valuable retirement benefits to their employees.”
“The proposed rule helps working Americans — and their families — take care of themselves in their retirement years.”
IRA guru Ed Slott:
”There are many small employers who would like to offer more comprehensive retirement plans for their employees and to attract new hires, but the costs, compliance and paperwork requirements to implement their own company plans were overwhelming and deterred them. They were also worried about liability.” (Source)
Deborah Hembree, senior counsel with employment law firm Constangy, Brooks, Smith & Prophete:
“MEPs offer a cost-effective way for small employers to provide retirement benefits to their employees by pooling resources with other small employers.”
Aliya Wong, in charge of retirement issues at the U.S. Chamber of Commerce:
“This proposal will expand retirement savings opportunities for millions of small business employees.”
Lisa Bleier, managing director of public policy and associate general counsel of the Securities Industry and Financial Markets Association (Sifma):
“We’re very supportive of the idea of multiple employer plans. We’re looking for options that will make sense to sell to businesses so that they can expand access and participate in retirement savings plans.”
“MEPs make it easier for small businesses to access economies of scale, by sharing costs with fellow employers.” This, Ms Bleier says,”is something financial advisers can use to sell to small-business owners.” (Source)
Dave Gray, head of retirement products and solutions at Fidelity Investments:
“The DOL’s proposal is a key step, but without additional changes to address continuing impediments posed by commonality and ‘one bad apple’ requirements, MEPs and (association retirement plans) will continue to be out of reach for many small employers.” (Source)
