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Broker / Consultant Compensation Disclosures

The Consolidated Appropriations Act of 2021 requires brokers and consultants to disclose to group health plans the direct and indirect compensation they expect to receive in connection with the services they provide to the plans. This compensation disclosure must be provided before the service contract is entered into or renewed, and the plan must be informed if the information in the disclosure changes. The broker/consultant must also provide the compensation disclosure to a plan upon request in order to permit the plan to comply with any applicable reporting and disclosure requirements. If the compensation disclosure is not provided, a plan fiduciary is required to request the compensation disclosure from the broker/consultant and, if it is still not provided in response to that request, notify the DOL and potentially terminate the contract. Implementing regulations and/or guidance have not yet been issued. This new requirement is scheduled to go into effect on… Continue Reading

Severe Winter Storm Hardship Withdrawal Relief

The safe harbor rules for hardship withdrawals from a retirement plan permit such withdrawals for expenses and losses incurred by a participant due to a natural disaster declared by the Federal Emergency Management Agency (?Ç£FEMA?Ç¥) under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, provided the participant?ÇÖs principal residence or principal place of employment at the time of the disaster was located in an area designated by FEMA for individual assistance related to that disaster. FEMA issued a series of disaster declarations as a result of the February 2021 winter storms that impacted portions of Texas, Louisiana, and Oklahoma. A list of counties that have been designated by FEMA for individual assistance in those states can be found on FEMA?ÇÖs website here. Those disaster declarations mean that affected participants may be eligible for hardship distributions from their 401(k) plan accounts. Plan sponsors with participants who live or work… Continue Reading

Texas Bill Would Make Service via Facebook the Law

Texas lawmakers will consider a bill that would specifically allow for service of legal process via Facebook or other social media sites. House Bill 1989 was introduced earlier this week by Rep. Jeff Leach (R ?Çô Plano), a recently elected lawmaker and an associate at a Dallas law firm. The short bill provides that a Texas court may permit as a method of service ?Ç£an electronic communication sent to the defendant through a social media website,?Ç¥ provided the court finds that: the defendant maintains a social media page on that website; the profile on the social media page is the profile of the defendant; the defendant regularly accesses the social media page account; and the defendant could reasonably be expected to receive actual notice if the electronic communication were sent to the defendant’s account. As we have previously noted, courts in Australia, New Zealand and the UK have permitted service… Continue Reading

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