The Department of Labor (DOL) administers and enforces more than 180 federal laws. These mandates and the regulations that implement them cover many workplace activities for about 10 million employers and 125 million workers.

The Employee Retirement Income Security Act (ERISA) regulates employers who offer pension or welfare benefit plans for their employees. Title I of ERISA is administered bathe Employee Benefits Security Administration (EBSA) and imposes a wide range of fiduciary, disclosure and reporting requirements on fiduciaries of pension and welfare benefit plans and on others having dealings with these plans.

The DOL has a comprehensive website with resources and publications that can assist plan sponsors and fiduciaries navigate through the decision making process as it relates to their retirement plans. To view these resources, visit www.dol.gov.

Employers have a fiduciary responsibility to provide employees with access to fund performance and investment education and tools to ensure they make informed decisions related to their contributions. The good news is there is a lot you can provide your employees, without taking on the liability of providing advice. During your annual plan review, it is recommended employers evaluate their educational programs to determine the following:
Education is free of bias or conflict of interest

• Delivery methods meet the needs of employee population (on­line, telephone, printed materials)
• Marketing and communication of educational resources is effective
• Employees are making use of educational resources
• Topics address the needs of employee population

The Department of Labors Interpretive Bulletin 96-I outlines educational activities that will not constitute “investment advice.” There are four general categories of investment-related information and materials that you can provide employees.

1. Plan Information Employers should provide information and materials that inform employees about the benefits of plan participation, the benefits of increasing plan contributions, the impact of pre-retirement withdrawals on retirement income, and the terms and operations of the plan. Employers may also include information that is described in the regulations under Section 404(c) of ERISA on investment alternatives in the plan.
2. General Financial and Investment Information The information you provide cannot directly reference any of the investment options available to employees and must be general in nature to satisfy the education safe harbor. Examples of this type of information include: general financial and investment concepts such as risk and return, diversification, dollar-cost averaging, compounded return, and tax-deferral; historic rates of return between different asset classes based on standard market indices; the effects of inflation; estimating future retirement income needs; determining investment time horizons; and assessing risk tolerance.
3. Asset Allocation In order to help your employees understand how to allocate their funds, you may also provide them with model portfolios showing different asset allocations for different time horizons and risk profiles. These models must be based on generally accepted investment theories that take into account historic returns of different asset classes over defined periods. All material facts and assumptions on which the models are based must accompany the models.
4. Interactive Investment Materials This category includes questionnaires, worksheets, software, and similar materials that provide employees with the means to estimate future retirement income needs.