What information is an employer required to give participants to explain the new cash balance plan formula, and when should they receive this information?
Many employers voluntarily provide helpful information about these conversions in advance of the change becoming effective. Participants have a right to contact the plan administrator and ask for more information or help in understanding the change and any choices they have in conjunction with the change. Plan administrators are required to give at least 15 days’ advance notice of plan amendments that significantly reduce the rate at which plan participants earn benefits in the future. After the plan is amended, the plan administrator is required to provide all plan participants with a Summary of Material Modifications to the plan or a revised Summary Plan Description. This document will summarize the changes to the plan. In addition, under the Age Discrimination in Employment Act (ADEA), an employer requiring an employee to sign a waiver of rights and claims when choosing between plans is required to provide enough information to enable the employee to make a knowing and voluntary dec
