Executive Order Encourages Expanded Access to Retirement Plans for Small Businesses, and Lowering Administrative Costs
President Trump recently issued an Executive Order intended to help small businesses to offer retirement benefits to their employees through multiple employer plans, referred to in the Order as “Association Retirement Plans” or “ARPs.” The Order observes that nearly 34% of all private sector workers (including full-time and part-time) do not have any employer-provided retirement plan. The primary reasons for the lack of an employer retirement plan, according to the Order, are regulatory burdens and high administration costs related to qualified retirement plans. The Order requests that the Treasury Secretary and the Labor Secretary review and consult with one another on issuing guidance, including proposed regulations, to reduce the associated costs and expand the ability of small businesses to jointly offer qualified retirement benefits to their employees as a group or association. The Order also directs the Treasury and Labor Secretaries to review ways to reduce the administrative costs related to required retirement plan disclosures, including making the disclosures more understandable and expanding the use of electronic delivery.
Keep an eye on this blog for any developments on the use of ARPs or changes to required disclosures. If you are interested in providing comments to the Treasury and Labor Secretaries on these issues, please contact a member of the Employee Benefits and Executive Compensation Group.