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Archived News Release--Caution:
information may be out of date.
For more information call: (202) 219-8921
Millions of workers who invest money in their retirement
plans may benefit from Department of Labor guidelines issued Monday that give
employers clearer guidelines about investment information they can give their
employees.
Interpretive Bulletin 96-1 was developed by the Labor
Department in response to requests from employers about what they can tell
employees without the information being considered financial advice. The
guidelines could help the more than 20 million workers who invest in 401(k)
retirement funds and who have to make choices about how to allocate their money
among various investment options.
"Everyone wins with this program," said Secretary of Labor
Robert B. Reich. "Employers and providers will learn how to avoid crossing the
line between investment education and investment advice. Workers will be able
to get better information about their investment choices."
Olena Berg, assistant secretary for pensions and welfare
benefits, said, "Today, workers increasingly have to take responsibility for
making decisions about their retirement investments. Our action is designed to
allow companies to provide more information so workers can make good investment
choices. At the same time, we want to be able to more clearly tell companies
what they can say to workers."
In recent years, as the number of 401(k) plans has grown,
employees often have to choose from among a variety of investment options
offering differing risks and rewards.
A draft Interpretive Bulletin was circulated in December
and received some 30 comments, all of which supported the basic concept and
philosophy.
The Bulletin, published in the Federal Register today
details the difference between information and advice, according to the
provisions of the Employee Retirement Income Security Act (ERISA). It says that
employers and service providers can provide three categories of information and
material without being liable for losses arising from workers' investment
decisions. They are:
- general financial and investment information which has no direct
relationship to specific investment alternatives available to
participants.
- materials which help participants assess the relevance of
hypothetical asset allocation models to their investment situation.
- interactive material and information that allows participants to
design and assess multiple asset allocation models.
More detailed information is available from the Pension
and Welfare Benefits Administration, which administers federal pension law, at
the U.S. Department of Labor, Washington, D.C. 20210, telephone (202-219-8671).
This is not a toll-free number. The bulletin will be on the Internet after June
14 at address http://www.dol.gov/dol/pwba.
Archived News Release--Caution:
information may be out of date.
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