As of this writing, it has been over 850 days since the UConn women’s basketball team has lost a game. When the Huskies last tasted defeat (in an overtime thriller to Stanford on November 17, 2014), football players at Northwestern University were pursuing their rights to collectively bargain after a ruling by the NLRB regional director in Chicago held they were statutory employees.  While the undefeated nature of women’s basketball in Storrs, CT has been a constant, the NLRB changed the game for Northwestern football players by declining to assert jurisdiction.  However, there remains a feeling in certain quarters of college sports that some form of pay to student-athletes is inevitable.

Continue Reading March Inevitableness? Considering the Legal Consequences of Pay to Student-Athletes

Uber, Lyft, and their competitors, offering handy apps, responsive drivers and competitive prices, are fast becoming a favored commuter option.  Many employers either subsidize employee commuter expenses or allow employees to pay for commuter expenses through payroll deductions.  Under current law (Internal Revenue Code Section 132(f)) and regulation, these expenses can be tax-free (up to certain dollar limits) if they are incurred through qualifying commuter highway vehicles, van pools, transit passes, parking, and bicycles.  Many employers and employees are asking: can Uber and Lyft commutes be provided tax-free?

Continue Reading Can Employees Commute Tax-Free on Uber or Lyft?

This post continues our examination of the Department of Labor’s suite of final fiduciary and conflict of interest regulations. Our previous posts discussed the newly expanded definition of “investment advice fiduciary”; the “best interest contract” (or BIC) exemption; and the new class exemption for principal transactions. Collectively, these rules vastly expand the definition of an “investment advice fiduciary” while at the same time providing new prohibited transaction class exemptions intended to preserve many of the commission-based compensation arrangements that would otherwise be imperiled under the new fiduciary standard. In this and the next three posts, we will examine how the Department has amended certain existing Prohibited Transaction Exemptions to come into alignment with its new fiduciary and conflict of interest standards.

This post explains the changes to Prohibited Transaction Exemption (PTE) 84-24 relating to insurance agents and brokers.

Continue Reading The Department of Labor’s 2016 Final Fiduciary and Conflict of Interest Regulations: Amendments to Prohibited Transaction Exemption 84-24 for Transactions Involving Insurance Agents and Brokers (and Others)

This post continues our examination of the Department of Labor’s suite of final fiduciary and conflict of interest regulations. Our prior posts discussed the newly expanded definition of “investment advice fiduciary” and the “best interest contract” (or BIC) exemption. In this post we explain the suite’s second new prohibited transaction class exemption entitled: “Class Exemption for Principal Transactions in Certain Assets between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs”. This exemption generally permits the trading of debt instruments in principal and riskless principal transactions involving Employee Retirement Income Security Act (ERISA)-regulated retirement plans and Individual Retirement Accounts (IRAs).

Continue Reading The Department of Labor’s 2016 Final Fiduciary and Conflict of Interest Regulations: The Principal Transactions Exemption

Last month the U.S. Department of Labor published a suite of final regulations governing the fiduciary status of, and prescribing conflict of interest rules that apply to, persons who provide investment advice to ERISA-covered retirement plans and Individual Retirement Accounts (IRAs). (For a list of, and links to, these final regulations, please see our April 11, 2016 post). As we explained previously, the final regulations will have important and far reaching consequences for financial advisors of all stripes (e.g., broker-dealers/registered representatives, Registered Investment Advisors (RIAs), and insurance agents and brokers, among others) who advise retirement plans and IRA investors.

In an earlier post we examined the new and greatly expanded definition of an “investment advice fiduciary,” which is of central importance to the Department’s new regulatory scheme.  In this post, we explain the “Best Interest Contract” (or “BIC”) exemption, which allows advisors to receive commission-based compensation that would be barred under the new fiduciary standard, subject to strict new rules intended to protect investors.

Continue Reading The Department of Labor’s 2016 Final Fiduciary and Conflict of Interest Rule: The Best Interest Contract Exemption

With this post, we begin our substantive explanation of the Department of Labor’s suite of final fiduciary and conflict of interest regulations. For the financial services industry, and for the retirement plans and IRAs, there are game-changing rules. This post covers the definition of what constitutes and “investment advice fiduciary.”  Future posts will examine the remaining regulations (dealing principally with conflicts of interest) and their impact on stakeholders.

Continue Reading The Department of Labor’s 2016 Final Fiduciary and Conflict of Interest Regulations: The New Fiduciary Standard

Even though the Affordable Care Act’s employer mandate is in effect and fully phased-in, it has been our experience that few employers have bothered to review their employee handbooks to reflect the ACA.  Below we discuss how employers may bolster their ACA compliance (and avoid ACA penalties) through an ACA-focused employee handbook review.

Continue Reading Have You Reviewed your Employee Handbook for Affordable Care Act Compliance?

After six years in the hopper, the Department of Labor finally issued final fiduciary regulations late last week that will greatly impact a wide variety of stakeholders. The Employee Retirement Income Security Act (ERISA) governs fiduciary conduct and establishes rules that bar certain transactions, referred to as “prohibited transactions.” While ERISA’s fiduciary standards and prohibited transaction rules apply principally to retirement plans, ERISA also amended the Internal Revenue Code to impose nearly identical prohibited transaction, but not fiduciary, rules on IRAs, Health Savings Accounts, Archer Medical Savings Accounts and Coverdell Education Savings Accounts. The Department of Labor is charged with interpreting the ERISA and Code provisions relating to fiduciary status and prohibited transactions, and its much anticipated suite of final regulations:

  • Makes sweeping changes to the definition of the term “fiduciary” under ERISA;
  • Imposes strict, new conflict of interest provisions on persons who provide investment advice to ERISA-covered retirement plans and Individual Retirement Accounts; and
  • Modifies a handful of existing prohibited transaction class exemptions.

The purpose of this post is to alert readers to the publication of these new fiduciary and prohibited transaction rules and provide links to the original source materials. In the coming weeks and months we will delve into the particulars of each of the components of the new rules. We will then turn our attention to the impact of these rules on various stakeholders—including large and small retirement plans, the financial services industry (including broker-dealers and registered investment advisors) and other issuers of financial products and providers of financial services.

Continue Reading Hold on to Your (Fiduciary) Hats: the Countdown to Compliance with the Department of Labor’s Final Fiduciary Rules Begins

This is the second installment of a series regarding legal issues affecting college athletics that will run during this year’s NCAA basketball tournament.

It is no secret that the salaries of coaches of high profile college programs are rising steadily.  In a recent report listing the highest paid public employee for each of the fifty states, 40 were college coaches.  While Alabama football coach Nick Saban led that list with annual compensation of around $7 million, the Chronicle of Higher Education also reported the Crimson Tide were just 1 of 10 athletic programs in 2014 to give more money back to its campus than it received in subsidies.  As a famous comic book hero once said – “with great power, comes great responsibility.”  It is therefore important to examine the legal concerns affecting coaching pay, which based on recent events, will increasingly include responsibility for conduct detrimental to athletic programs.

Continue Reading More Money, More Problems? – The Rise of Compensation and Expectations for College Coaches