DOL Proposal Seeks to Expand Use of Multiple-Employer Plans

The Department of Labor (DOL) recently proposed a rule revising the definition of “employer” under Section 3(5) of the Employee Retirement Income Security Act of 1974 (“ERISA”) for purposes of sponsoring a multiple-employer plan (MEP). The proposed rule, which is in response to President Trump’s August 31, 2018 Executive Order directing the DOL to examine policies expanding access to MEPs, would make it easier for small businesses who meet certain requirements to pool their resources to form a MEP, thereby reducing administrative costs. In order to be covered by ERISA, a retirement plan must be established or maintained by an “employer.” “Employer” is defined by Section 3(5) of ERISA to include “any person acting directly as an employer, or indirectly in the interest of an employer, in relation to an employee benefit plan; and includes a group or association of employers acting for an employer in such capacity.”…

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