Legislative & Regulatory Update

Changes to how we help you fulfill your disclosure responsibilities to participants through electronic delivery

BY Updated 9/10/2020

In May 2020, the Department of Labor (DOL) issued a final regulation that created a new safe harbor for delivering ERISA required documents electronically. The new rule provides the ability to default participants into electronic delivery (eDelivery) after sending an Initial Notice in paper form. Disclosures can then be posted on a website if a Notification of Internet Availability (NOIA) is furnished electronically to participants when the document is made available.

As a result of the new rule, Fidelity is implementing changes in October 2020 to how we help you fulfill your retirement plan disclosure responsibilities.1 The expansion of electronic accessibility not only helps you to satisfy regulatory disclosure requirements, but also allows participants to receive communications in the digital manner they’ve come to expect.

WHAT YOU CAN EXPECT

To maximize eDelivery of required documents, Fidelity will utilize both the DOL's new default electronic disclosure safe harbor ("New Rule"), as well as the 2002 eDelivery safe harbor (the "2002 Rule").

The 2002 Rule is available for participants who:

1. Are "wired at work," using email as an "integral part" of their work-related duties; or
2. Provided an email address and affirmatively consented to receiving electronic disclosures.

For the 93% of participants with an email address on file in NetBenefits® who already receive disclosures electronically, nothing will change.2 Fidelity will continue to distribute required communications electronically in accordance with the 2002 Rule.

For the remaining 7% of participants where we have a personal email address on file in NetBenefits® but they have not provided affirmative consent to receive disclosures electronically, Fidelity will utilize the New Rule to enable eDelivery where possible.2

NEXT STEPS FOR NOTIFYING YOUR PARTICIPANTS

Initial Notice
Beginning October 2020, Fidelity will mail an Initial Notice (view sample) to participants who have an email address on file in NetBenefits®, yet have not provided consent for eDelivery. The notice will inform participants that required retirement plan documents will be delivered electronically to their email on file in NetBenefits®, as well as provide instructions on how to opt out of eDelivery and/or request a paper disclosure, if desired.

At this time, Fidelity will not charge plan sponsors for mailing the Initial Notice.

Important note: Since the New Rule requires an email address, any participants who do not have an email address on file will not receive an Initial Notice. If the participant later provides their email address, then Fidelity will mail an Initial Notice. In addition, those participants for whom Fidelity is utilizing the 2002 Rule will not receive an Initial Notice.

Notice of Internet Availability (NOIA)
Fidelity will keep a record of participants who received an Initial Notice to determine their eligibility for eDelivery. Eligible participants will then receive the NOIA when disclosures are made available electronically.

We're currently modifying the eDelivery disclosure documents to be consistent with NOIA requirements under the New Rule. As these emails are updated, they will be utilized for eDelivery to participants.

QUESTIONS

Contact your Fidelity representative.

NEXT STEPS

1For non-ERISA plans, Fidelity will utilize the New Rule for certain communications that are not required but may be sent electronically today, such as quarterly account statements.
2Fidelity book of business data, as of July 2020.

For plan sponsor use only and investment professional use.
Approved for use in Advisor and 401(k) markets. Firm review may apply.

Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.

Fidelity Investments Institutional Operations Company LLC., 245 Summer Street, Boston, MA 02210
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