The Department of Labor has published limited interpretive guidance to help small employers select high-quality, low-cost “pooled employer plans” or “PEPs.”
Here is an Executive Summary of the guidance:
“In this document, the Department is taking initial steps to build on positive market developments to help small employers join high-quality, low-cost retirement plans called pooled employer plans (PEPs) and provide more attractive benefits to workers and potential hires. Because PEPs are relatively new, small employers may be unaware of PEPs or may not understand the Employee Retirement Income Security Act of 1974 (ERISA) standards applicable to them. The Department hopes to address challenges such as these which may impede small employers from taking advantage of PEPs. In addition to promoting retirement savings and reducing participant costs, expanding the use of PEPs is aligned with the Department’s broader economic goals, including improving job quality and increasing labor force participation, especially at small businesses. Section II of this document provides a general description of the ERISA framework applicable to PEPs. Section III contains limited observations of the PEP marketplace made by the Department based on reports filed with the agency. Section IV provides limited interpretive guidance to help small employers understand their responsibilities as fiduciaries in connection with joining a PEP. Section V includes a set of “tips” to assist small employers in selecting a PEP. Section VI solicits information about prevailing PEP practices, responses to which will be considered as a possible basis for a regulatory safe harbor that encourages market participants to offer and employers to join such plans. Section VII seeks input on information to assist the Department in developing the report to Congress required by section 344 of SECURE 2.0.”
You can access the guidance here.