The DOL’s electronic disclosure regulations allow for electronic distribution of a wide range of Employee Retirement Income Security Act (ERISA) documents. The regulations impose certain basic conditions for all electronic disclosures. When the basic conditions are met, ERISA-required documents may be provided electronically to employees who have work-related computer access. For non-employees (like COBRA qualified beneficiaries and covered spouses) or for those who do not have work-related computer access, there are more detailed requirements for electronic disclosure.
Using Electronic Disclosure for Employees With Work-Related Computer Access
When the basic conditions are met, ERISA documents may be distributed electronically to employees with work-related computer access. Per the ERISA regulations, employees are treated as having work-related computer access if (1) they have the ability to access documents at any location where they reasonably could be expected to perform employment duties (this can include computer access at a home office); and (2) access to the employer’s electronic information system is an integral part of their employment duties. Employees who have access to your computer system but who do not use that system as an integral part of their work (e.g., staff with building maintenance, food service, copying or similar duties) must receive paper copies of ERISA disclosure items.
Using Electronic Disclosure for Individuals Without Work-Related Computer Access
When both the basic and certain additional conditions are met, ERISA documents may be furnished electronically even to individuals without work-related computer access. The additional conditions require the employer to obtain consent for electronic disclosure. The consent must include a statement explaining how the electronic delivery system will work, including the types of documents to be provided, procedures for withdrawing consent and updating personal information and what hardware and software will be needed. The need to furnish paper copies of the required pre-consent statement and to keep track of a large number of individual consents (and individual electronic delivery addresses) makes electronic disclosure to non-employees (and to employees without work-related computer access) less attractive for many employers. In addition, even some of the basic conditions are more challenging for this group of recipients—for example, your company’s internal security and confidentiality protections will not protect personal information transmitted outside the system to non-employees.
There May Be Additional Issues Created by Particular Disclosure Items
As noted, the final regulations permit a wide range of documents to be distributed electronically, including all ERISA Title I disclosures. This covers QDRO and QMCSO notices and COBRA notices, documents that must be provided to participants and beneficiaries after written request under ERISA Section 104(b), pension plan investment information, individual pension benefit statements, and information about pension plan loans.
Even if your company decides in principle to use electronic communications for employees and former employees, you may decide that some types of notices (e.g., COBRA election notices) are not well suited for electronic transmission, for various reasons.
Interested in EAF Membership? Join now and receive 10% off NEW Member Dues!
Use PROMO CODE: NewYearEAF2017 on your Member Application.