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DOL Announces Temporary Enforcement Policy for PTE 2020-02

The DOL recently issued Field Assistance Bulletin No. 2021-02 (the “Bulletin”) announcing a delay in the enforcement of Prohibited Transaction Exemption 2020-02, Improving Investment Advice for Workers & Retirees (“PTE 2020-02”). PTE 2020-02 was adopted by the DOL on December 18, 2020, and sets forth several requirements that investment advice fiduciaries who rely on the exemption must satisfy when providing advice, which we previously discussed on our blog here and here. PTE 2020-02 became effective on February 16, 2021, but the DOL previously provided transitional relief through December 20, 2021. In the Bulletin, the DOL announced a temporary enforcement policy which provides that (i) for the period from December 21, 2021 through January 31, 2022, the DOL will not pursue prohibited transaction claims against investment advice fiduciaries who are working diligently and in good faith to comply with the impartial conduct standards for transactions that are exempted under PTE 2020-02 or treat such fiduciaries as violating the applicable prohibited transaction rules, and (ii) from December 21, 2021 through June 30, 2022, the DOL will not pursue prohibited transaction claims against investment advice fiduciaries who are otherwise in compliance with PTE 2020-02 based solely on their failure to comply with the disclosure and documentation requirements.

The Bulletin is available here.

The lawyers of our Employee Benefits and Executive Compensation Practice Group are readily able to assist companies on a nationwide basis with implementing sophisticated benefit plans and providing answers to their most challenging compensation issues. Additionally, our lawyers are well aware of the daily employee benefits challenges facing companies of all sizes and are capable of helping in-house lawyers and human resources personnel with the day-to-day advice and guidance necessary to properly administer employee benefits plans.

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