A resolution to disapprove the Department of Labor’s “Retirement Security Rule” could come up for a full floor vote of the House of Representatives before long if a House committee passes the resolution during a vote on Wednesday in Washington, D.C.
The House Education and Workforce Committee has scheduled a July 10 vote during a Full Committee Markup session on a Congressional Review Act resolution to disapprove the DOL’s Retirement Security Rule, frequently referred to as the fiduciary rule.
The Insured Retirement Institute calls the rule an “attempt to impose a one-size-fits-all fiduciary standard on virtually all financial professionals who sell retirement products,” and is urging committee members to pass the resolution of disapproval.
During Wednesday’s session, the Education and the Workforce Committee will mark up H.R. 8932,FAFSA Deadline Act; H.R. 2574, EMS Counts Act; H.R. 2941, Recognizing the Role of Direct Support Professionals Act; H.R. 6319, Supporting Accurate Views of Emergency Services Act of 2023; and H.J. Res. 142, Congressional Review Act resolution to stop the fiduciary rule.
“The Committee continues to move at an expeditious pace, with the imperatives of meeting the priorities of the American people, and confronting the Biden administration’s wrongheaded policy agenda, at the forefront of our work,” said Education and the Workforce Committee Chairwoman Virginia Foxx (R-NC), in a statement released July 8. “These five bills work to achieve those ends. From enhancing workforce data collection to protecting financial options of retirees and savers and ensuring the timely release of FAFSA, our work continues without delay.”
While Republicans on the committee have repeatedly expressed opposition to the fiduciary rule, Democrats generally support it.
During a Subcommittee on Health, Employment, Labor, and Pensions Hearing, “Examining the Policies and Priorities of the Employee Benefits Security Administration” held on June 27, Ranking Member Mark DeSaulnier (D-CA) noted that House Republicans have proposed to cut EBSA’s budget by $10 million in this year’s Labor-HHS appropriations bill, another move he says is in line with consistent underfunding of the agency by the majority.
“This is a crisis for workers, retirees and their families. And it should not be a partisan issue,” DeSaulnier said during his opening remarks at the hearing. “Cuts to EBSA undermine the bipartisan progress we have made in recent years through the No Surprises Act, the SECURE Act, the SECURE 2.0 Act, and so many other important laws.”
DeSaulnier went on to express support for the EBSA’s Retirement Security Rule, which he said will ensure consumers get financial advice free from conflicts of interest and cited Morningstar’s calculation that the rule “would save over $55 billion in the first 10 years and over $130 billion in the subsequent 10 years.”
More challenges to fiduciary rule
The controversial fiduciary rule—currently set to take effect in September—is under attack on multiple fronts.
In addition to the House Education and the Workforce Committee resolution of disapproval coming up for a vote Wednesday, two lawsuits have been filed by various insurance and financial services groups seeking for the new rule to be struck down, and last week’s U.S. Supreme Court Chevron doctrine ruling means the DOL’s interpretations of laws such as the Employee Retirement Income Security Act (ERISA) are expected to face more rigorous judicial scrutiny.
That landmark change makes it easier for plaintiffs to challenge DOL regulations in court, potentially stalling or invalidating rules like the forthcoming Retirement Security Rule.
More DOL happenings
The DOL is also holding its ERISA Advisory Council meeting this week in Washington, July 8-10. Open to the public, the meeting is in-person and accessible online and via teleconference.
The council is reviewing two study topics for the year and receiving an update from the EBSA. The council’s 2024 study topics are “Making Welfare Plan Claims and Appeals Procedures More Accessible to Participants” and “Lifetime Income and Qualified Defined Investment Alternatives.”
The full meeting agenda can be found here, and interested persons can read the Federal Register notice for more information on how to participate in the meeting.
Established by the Employee Retirement Income Security Act, the ERISA Advisory Council advises the secretary of labor and submits recommendations regarding the secretary’s functions under ERISA.
Separately, the DOL will also hear directly from members of the National Society of Compliance Professionals in order to assist it with implementation of the rule during a special meeting of the DOL Fiduciary Rule Working Group on Wednesday at noon EDT.
Fred Reish, Partner at Faegre Drinker, is facilitating monthly meetings for the group. At Wednesday’s special interactive discussion (exclusively for NSCP members), Reish will be joined by DOL Principal Deputy Assistant Secretary Ali Khawar and DOL Deputy Assistant Secretary for Program Operations Timothy D. Hauser.
SEE ALSO:
• Fiduciary Rule Fate Clouds in Wake of SCOTUS Chevron Doctrine Ruling
• FSI, SIFMA Join Lawsuit Against Fiduciary Rule; CFP Board Backs It in Separate Suit
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
