The Department of Labor (DOL) has published a final rule setting forth the responsibilities of plan administrators to disclose certain information, including information regarding fees and expenses, to participants and beneficiaries in participant-directed individual account plans, including most 401(k) plans. The final rule was published in the October 20, 2010 Federal Register. Although the rule takes effect December 20, 2010, it is not applicable to a plan until its first plan year beginning on or after November 1, 2011. For calendar year plans, that would be January 1, 2012.

The rule was issued to ensure that plan participants are aware of their rights and responsibilities with respect to managing their individual plan accounts and are provided sufficient information regarding the plan and designated investment alternatives to make informed decisions about the management of their individual accounts. The new requirements are fiduciary requirements, with which a fiduciary must comply in order to satisfy its obligation to invest plan assets prudently and in the interests of participants and beneficiaries when the authority to direct investments has been delegated to those participants and beneficiaries. Failure to comply will constitute a breach of fiduciary duty, whether or not the plan otherwise complies with section 404(c) of ERISA.