Benz Communications’ Jen Benz Draws on Work with Fortune 500 and Fortune 100 Best Companies to Work For in Response to Department of Labor’s RFI Regarding Expanded Use of Electronic Disclosures by Benefit Plan Sponsors Jul 14, 2011
San Francisco, CA—July 14, 2011—In April, the Department of Labor issued a Request for Information (RFI) regarding proposed rules that would expand the use of electronic disclosures by benefit plan sponsors.
Jennifer Benz has been guiding Benz Communications’ growing roster of Fortune 500 and Fortune 100 Best Companies to Work For clients toward increased use of the Internet to deliver benefit plan information, within the existing Department of Labor regulations for electronic disclosures. Jen is the Founder and Chief Strategist of Benz Communications, a leading HR and benefit communication strategy boutique.
A determined and enthusiastic advocate for disseminating benefit information via the Internet, Jen says, “Employee benefit programs yield business value only if employees understand, appreciate, and use their benefits. Communicating with employees via the Internet is the most expedient method for reaching employees with time-sensitive material. We strongly encourage our clients to put all of their benefits information on the Internet so employees, retirees, family members, and all other program participants can access the information they need when they need it.”
In summarizing the firm’s position, Jen says, “Electronic delivery is better; regulations must be more clearly written, leaving less room for interpretation, than they are currently; and ‘legalese’ must be replaced with clear language.”
Key points from Benz Communications’ response to the DOL’s RFI follow.
Q: What are the most significant impediments to increasing the use of electronic media (e.g., regulatory impediments, lack of interest by participants, lack of interest by plan sponsors, access issues, technological illiteracy, privacy concerns, etc.)?
A: Regulation is the primary impediment to increased use of electronic media by plan sponsors. Legal teams believe all or some legally-mandated notices must be delivered via print. Benefit teams rely on legal expertise. This results in a bias toward print delivery of benefit information to avoid risk and the increased cost of print and electronic delivery. A key driver of more widespread acceptance and use of electronic disclosure is new regulations that support and guide plan sponsor use of electronic disclosures.
Q: Are there any new or evolving technologies that might impact electronic disclosure in the foreseeable future?
A: From the plan sponsor perspective, online content management systems are central to cost-effective maintenance. These systems are now widely available and their use can significantly reduce the current cost of delivering benefit plan notices electronically – which is already well below the cost for print notices. From an employee perspective, the technology with the power to have the greatest impact on electronic disclosure is mobile devices. According to Pew Research, mobile Internet access is increasing Internet use by minorities and lower-income Americans.
Q: To what extent should the Department encourage or require pension and welfare benefit plans to furnish some or all disclosures required under title I of ERISA through a continuous access Web site(s)?
A: All information should be continuously available via the Internet. Given the 24/7 nature – the “new normal” – of American life, employees, retirees, family members, and other participants should be able to access the information they need when they need it.
- Print is temporary and immediately out-of-date; electronic delivery is constant and consistent. When offered online, SPDs, for example, are current whenever accessed; older versions may be archived.
- Technology costs have decreased. The costs of building and maintaining a custom website have dropped dramatically; content management systems eliminate the need for web developers to provide ongoing site maintenance.
- Employers’ privacy expectations have declined. In an era of transparency, employers no longer fear “leaking” benefit program information to competitors. Benz Communications advocates for informational, non-personalized websites that don’t require passwords.
- Legal notices are often ignored by employees. Employee focus groups reveal that the most memorable benefits communications use clear, simple language and educational graphics; people do not engage with material written in “legalese.” The Affordable Care Act acknowledges this with its requirement that “…the summary is presented in a culturally and linguistically appropriate manner and utilizes terminology understandable by the average plan enrollee.”
Q: Is it more efficient to send an e-mail with the disclosure attached (e.g., as a PDF file) versus a link to a Web site?
A: Providing information via a website is more efficient. A website is more practical and user-friendly, and increases flexibility for plan sponsors. Whether or not employees will receive, read, retain, and act upon a disclosure hinges on language, not delivery method.
Q: Employee benefit plans often are subject to more than one applicable disclosure law (e.g., ERISA, Internal Revenue Code) and regulatory agency. To what extent would such employee benefit plans benefit from a single electronic disclosure standard?
A: A single standard for electronic disclosures is preferable. As communications professionals gain mastery of the single standard, the need for legal opinions—and the costs associated with them—would decline.
About Benz Communications
Benz Communications is a benefits communications strategy boutique creating integrated employee benefits campaigns for employers committed to nurturing high-performing and satisfied employees. Benz Communications’ clients include Fortune 500 companies, Fortune 100 Best Companies to Work For, and small- to mid-size companies. Additional information about Benz Communications may be found at www.benzcommunications.com.
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