Employer Notice Flexibility During Open Enrollment

Published by Patrick Bell & Mike Mewbourne

One of the good things to come out of the extensive list of rules and regulations that have been issued in response to the COVID-19 pandemic is DOL Notice 2020-1. In this notice, the DOL recognizes that employers face unique challenges this year when trying to provide required notices and disclosures to employees. 

In response, the DOL has provided flexibility in how notices and disclosures can be provided during the Outbreak Period. Note that the Outbreak Period runs until 60 days after the national emergency is declared over by the Federal government.

During the Outbreak Period the DOL will not enforce the normal ERISA notice and disclosure requirements as long as “the plan…act[s] in good faith and furnish[es] the notice, disclosure, or document as soon as administratively practicable under the circumstances. Good faith acts include use of electronic alternative means of communicating with plan participants and beneficiaries who the plan fiduciary reasonably believes have effective access to electronic means of communication, including email, text messages, and continuous access websites.”

The DOL also states that the Department of Health and Human Services (HHS) has agreed to provide similar flexibility for requirements contained in the Public Health Service Act (PHSA) to plans not subject to ERISA, and the IRS will also take a similar approach to notice requirements under its jurisdiction.

How Could this Help During Open Enrollment Season?

Many employers have furloughed, but not laid off, large numbers of employees. Some of these employees may not have online access to the employer’s systems that meets the DOL electronic disclosure safe harbor requirements. The flexibility to provide information in other means could help in this situation.

I am particularly interested in the ability to post the information on “continuous access websites.” For example, an employer could post their benefits book and Summary of Benefits and Coverage (SBC) on the company website, then inform employees that they believe have internet access where to find the information. Unmistakably, employers need to make a reasonable effort to provide important plan information to participants, but this flexibility and enforcement relief is welcome news for employers struggling with employee communications during these difficult times.

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