(a) Short title.—This Act may be cited as the “Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg Act” or the “RISE & SHINE Act”.

(b) Table of contents.—The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

(a) In general.—Section 203(e)(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1053(e)(1)) and sections 401(a)(31)(B)(ii) and 411(a)(11)(A) of the Internal Revenue Code of 1986 are each amended by striking “$5,000” and inserting “$7,000”.

(b) Effective date.—The amendments made by this section shall apply to distributions made after December 31, 2023.

(a) In general.—Section 3(43)(A) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(43)(A)) is amended—

(1) in clause (ii), by striking “section 501(a) of such Code or” and inserting “section 501(a) of such Code, a plan that consists of contracts described in section 403(b) of such Code, or”; and

(2) in the flush text at the end, by striking “the plan.” and inserting “the plan, but such term shall include any program (other than a governmental plan) maintained for the benefit of the employees of more than 1 employer that consists of contracts described in section 403(b) of such Code and that meets the requirements of subparagraph (A) or (B) of section 413(e)(1) of such Code.”.

(b) Conforming amendments.—Sections 3(43)(B)(v)(II) and 3(44)(A)(i)(I) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(43)(B)(v)(II) and 1002(44)(A)(i)(I)) are each amended by striking “section 401(a) of such Code or” and inserting “section 401(a) of such Code, a plan that consists of contracts described in section 403(b) of such Code, or”.

(c) Effective date.—The amendments made by this section shall apply to plan years beginning after December 31, 2022.

(a) In general.—Not later than 2 years after the date of enactment of this Act, the Secretary of Labor shall promulgate regulations providing that, in the case of a designated investment alternative that contains a mix of asset classes, the administrator of a plan may, but is not required to, use a benchmark that is a blend of different broad-based securities market indices if—

(1) the blend is reasonably representative of the asset class holdings of the designated investment alternative;

(2) for purposes of determining the blend’s returns for 1-, 5-, and 10-calendar-year periods (or for the life of the alternative, if shorter), the blend is modified at least once per year to reflect changes in the asset class holdings of the designated investment alternative;

(3) the blend is furnished to participants and beneficiaries in a manner that is reasonably designed to be understandable; and

(4) each securities market index that is used for an associated asset class would separately satisfy the requirements of such regulation for such asset class.

(b) Study.—Not later than 3 years after the date of enactment of this Act, the Secretary of Labor shall deliver a report to the Committees on Finance and Health, Education, Labor, and Pensions of the Senate and the Committees on Ways and Means and Education and Labor of the House of Representatives regarding the utilization, effectiveness, and participants’ understanding of the benchmarking requirements under this section.

(a) In general.—Section 3(43)(B)(ii) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(43)(B)(ii)) is amended to read as follows:

“(ii) designate a named fiduciary (other than an employer in the plan) to be responsible for collecting contributions to the plan and require such fiduciary to implement written contribution collection procedures that are reasonable, diligent, and systematic;”.

(b) Effective date.—The amendments made by this section shall apply to plan years beginning after December 31, 2022.

Not later than 1 year after the date of enactment of this Act, the Secretary of Labor shall—

(1) review section 2509.95–1 of title 29, Code of Federal Regulations (relating to the fiduciary standards under the Employee Retirement Income Security Act of 1974 when selecting an annuity provider for a defined benefit pension plan) and consult with the Advisory Council on Employee Welfare and Pension Benefit Plans (established under section 512 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1142)), to determine whether amendments to section 2509.95–1 of title 29, Code of Federal Regulations are warranted; and

(2) report to Congress on the findings of such review and consultation, including an assessment of any risk to participants.

(a) Study.—As soon as practicable after the date of enactment of this Act, the Secretary of Labor, the Secretary of the Treasury, and the Director of the Pension Benefit Guaranty Corporation shall review the reporting and disclosure requirements, as applicable to each such agency head, of the Employee Retirement Income Security Act of 1974 applicable to pension plans (as defined in section 3(2) of such Act (29 U.S.C. 1002(2)).

(b) Report.—

(1) IN GENERAL.—Not later than 3 years after the date of enactment of this Act, the Secretary of Labor, the Secretary of the Treasury, and the Director of the Pension Benefit Guaranty Corporation, jointly, and after consultation with a balanced group of participant and employer representatives, shall with respect to plans referenced in subsection (a) report on the effectiveness of the applicable reporting and disclosure requirements and make such recommendations as may be appropriate to the Committee on Education and Labor and the Committee on Ways and Means of the House of Representatives and the Committee on Health, Education, Labor, and Pensions and the Committee on Finance of the Senate to consolidate, simplify, standardize, and improve such requirements so as to simplify reporting for such plans and ensure that plans can furnish and participants and beneficiaries timely receive and better understand the information they need to monitor their plans, plan for retirement, and obtain the benefits they have earned.

(2) ANALYSIS OF EFFECTIVENESS.—To assess the effectiveness of the applicable reporting and disclosure requirements, the report shall include an analysis, based on plan data, of how participants and beneficiaries are providing preferred contact information, the methods by which plan sponsors and plans are furnishing disclosures, and the rate at which participants and beneficiaries (grouped by key demographics) are receiving, accessing, understanding, and retaining disclosures.

(3) COLLECTION OF INFORMATION.—The agencies shall conduct appropriate surveys and data collection to obtain any needed information.

(a) Amendment of Employee Retirement Income Security Act of 1974.—

(1) IN GENERAL.—Part 1 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021 et seq.) is amended by redesignating section 111 as section 112 and by inserting after section 110 the following new section:

(2) CLERICAL AMENDMENT.—The table of contents in section 1 of the Employee Retirement Income Security Act of 1974 is amended by striking the item relating to section 111 and by inserting after the item relating to section 110 the following new items:

“Sec. 111. Eliminating unnecessary plan requirements related to unenrolled participants.
“Sec. 112. Repeal and effective date.”.

(b) Amendment of Internal Revenue Code of 1986.—Section 414 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

“(aa) Eliminating unnecessary plan requirements related to unenrolled participants.—

“(1) IN GENERAL.—Notwithstanding any other provision of this title, with respect to any defined contribution plan, no disclosure, notice, or other plan document (other than the notices and documents described in subparagraphs (A) and (B)) shall be required to be furnished under this title to any unenrolled participant if the unenrolled participant is furnished—

“(A) an annual reminder notice of such participant’s eligibility to participate in such plan and any applicable election deadlines under the plan, and

“(B) any document requested by such participant that the participant would be entitled to receive notwithstanding this subsection.

“(2) UNENROLLED PARTICIPANT.—For purposes of this subsection, the term ‘unenrolled participant’ means an employee who—

“(A) is eligible to participate in a defined contribution plan,

“(B) has been furnished—

“(i) the summary plan description pursuant to section 104(b) of the Employee Retirement Income Security Act of 1974, and

“(ii) any other notices related to eligibility under the plan and required to be furnished under this title, or the Employee Retirement Income Security Act of 1974, in connection with such participant’s initial eligibility to participate in such plan,

“(C) does not have an account balance in the plan, and

“(D) satisfies such other criteria as the Secretary of the Treasury may determine appropriate, as prescribed in guidance issued in consultation with the Secretary of Labor.

For purposes of this subsection, any eligibility to participate in the plan following any period for which such employee was not eligible to participate shall be treated as initial eligibility.

“(3) ANNUAL REMINDER NOTICE.—For purposes of this subsection, the term ‘annual reminder notice’ means the notice described in section 111(c) of the Employee Retirement Income Security Act of 1974.”.

(c) Effective date.—The amendments made by this section shall apply to plan years beginning after December 31, 2022.

(a) Overpayments under ERISA.—Section 206 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1056) is amended by adding at the end the following new subsection:

“(h) Special rules applicable to benefit overpayments.—

“(1) GENERAL RULE.—In the case of an inadvertent benefit overpayment by any pension plan, the responsible plan fiduciary shall not be considered to have failed to comply with the requirements of this title merely because such fiduciary determines, in the exercise of its fiduciary discretion, not to seek recovery of all or part of such overpayment from—

“(A) any participant or beneficiary,

“(B) any plan sponsor of, or contributing employer to—

“(i) an individual account plan, provided that the amount needed to prevent or restore any impermissible forfeiture from any participant’s or beneficiary’s account arising in connection with the overpayment is, separately from and independently of the overpayment, allocated to such account pursuant to the nonforfeitability requirements of section 203 (for example, out of the plan’s forfeiture account, additional employer contributions, or recoveries from those responsible for the overpayment), or

“(ii) a defined benefit pension plan subject to the funding rules in part 3 of this subtitle B, unless the responsible plan fiduciary determines, in the exercise of its fiduciary discretion, that failure to recover all or part of the overpayment faster than required under such funding rules would materially affect the plan’s ability to pay benefits due to other participants and beneficiaries, or

“(C) any fiduciary of the plan, other than a fiduciary (including a plan sponsor or contributing employer acting in a fiduciary capacity) whose breach of its fiduciary duties resulted in such overpayment, provided that if the plan has established prudent procedures to prevent and minimize overpayment of benefits and the relevant plan fiduciaries have followed such procedures, an inadvertent benefit overpayment will not give rise to a breach of fiduciary duty.

“(2) REDUCTION IN FUTURE BENEFIT PAYMENTS AND RECOVERY FROM RESPONSIBLE PARTY.—Paragraph (1) shall not fail to apply with respect to any inadvertent benefit overpayment merely because, after discovering such overpayment, the responsible plan fiduciary—

“(A) reduces future benefit payments to the correct amount provided for under the terms of the plan, or

“(B) seeks recovery from the person or persons responsible for the overpayment.

“(3) EMPLOYER FUNDING OBLIGATIONS.—Nothing in this subsection shall relieve an employer of any obligation imposed on it to make contributions to a plan to meet the minimum funding standards under part 3 of this subtitle B or to prevent or restore an impermissible forfeiture in accordance with section 203.

“(4) RECOUPMENT FROM PARTICIPANTS AND BENEFICIARIES.—If the responsible plan fiduciary, in the exercise of its fiduciary discretion, decides to seek recoupment from a participant or beneficiary of all or part of an inadvertent benefit overpayment made by the plan to such participant or beneficiary, it may do so, subject to the following conditions:

“(A) No interest or other additional amounts (such as collection costs or fees) are sought on overpaid amounts for any period.

“(B) If the plan seeks to recoup past overpayments of a non-decreasing periodic benefit by reducing future benefit payments—

“(i) the reduction ceases after the plan has recovered the full dollar amount of the overpayment,

“(ii) the amount recouped each calendar year does not exceed 10 percent of the full dollar amount of the overpayment, and

“(iii) future benefit payments are not reduced to below 90 percent of the periodic amount otherwise payable under the terms of the plan.

Alternatively, if the plan seeks to recoup past overpayments of a non-decreasing periodic benefit through one or more installment payments, the sum of such installment payments in any calendar year does not exceed the sum of the reductions that would be permitted in such year under the preceding sentence.

“(C) If the plan seeks to recoup past overpayments of a benefit other than a non-decreasing periodic benefit, the plan satisfies requirements developed by the Secretary for purposes of this subparagraph.

“(D) Efforts to recoup overpayments are—

“(i) not accompanied by threats of litigation, unless the responsible plan fiduciary reasonably believes it could prevail in a civil action brought in Federal or State court to recoup the overpayments, and

“(ii) not made through a collection agency or similar third party, unless the participant or beneficiary ignores or rejects efforts to recoup the overpayment following either a final judgment in Federal or State court or a settlement between the participant or beneficiary and the plan, in either case authorizing such recoupment.

“(E) Recoupment of past overpayments to a participant is not sought from any beneficiary of the participant, including a spouse, surviving spouse, former spouse, or other beneficiary.

“(F) Recoupment may not be sought if the first overpayment occurred more than 3 years before the participant or beneficiary is first notified in writing of the error.

“(G) A participant or beneficiary from whom recoupment is sought is entitled to contest all or part of the recoupment pursuant to the plan’s claims procedures.

“(H) In determining the amount of recoupment to seek, the responsible plan fiduciary shall take into account the hardship that recoupment likely would impose on the participant or beneficiary.

“(5) EFFECT OF CULPABILITY.—Subparagraphs (A) through (F) of paragraph (4) shall not apply to protect a participant or beneficiary who is culpable. For purposes of this paragraph, a participant or beneficiary is culpable if the individual bears responsibility for the overpayment (such as through misrepresentations or omissions that led to the overpayment), or if the individual knew, or had good reason to know under the circumstances, that the benefit payment or payments were materially in excess of the correct amount. Notwithstanding the preceding sentence, an individual is not culpable merely because the individual believed the benefit payment or payments were or might be in excess of the correct amount, if the individual raised that question with an authorized plan representative and was told the payment or payments were not in excess of the correct amount. With respect to a culpable participant or beneficiary, efforts to recoup overpayments shall not be made through threats of litigation, unless a lawyer for the plan makes a determination that there is a reasonable likelihood of success to recover an amount that would be greater than the cost of recovery.”.

(b) Effective date.—The amendments made by this section shall apply as of the date of enactment of this Act.

(c) Certain actions before date of enactment.—Plans, fiduciaries, employers, and plan sponsors are entitled to rely on—

(1) a good faith interpretation of then existing administrative guidance for inadvertent benefit overpayment recoupments and recoveries that commenced before the date of enactment of this Act, and

(2) determinations made before the date of enactment of this Act by the responsible plan fiduciary, in the exercise of its fiduciary discretion, not to seek recoupment or recovery of all or part of an inadvertent benefit overpayment.

In the case of a benefit overpayment that occurred prior to the date of enactment of this Act, any installment payments by the participant or beneficiary to the plan or any reduction in periodic benefit payments to the participant or beneficiary, which were made in recoupment of such overpayment and which commenced prior to such date, may continue after such date. Nothing in this subsection shall relieve a fiduciary from responsibility for an overpayment that resulted from a breach of its fiduciary duties.

(a) In general.—Section 202 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1052) is amended by adding at the end the following new subsection:

“(c) Special rule for certain part-time employees.—

“(1) IN GENERAL.—A pension plan that includes either a qualified cash or deferred arrangement (as defined in section 401(k) of the Internal Revenue Code of 1986) or a salary reduction agreement (as described in section 403(b) of such Code) shall not require, as a condition of participation in the arrangement or agreement, that an employee complete a period of service with the employer (or employers) maintaining the plan extending beyond the close of the earlier of—

“(A) the period permitted under subsection (a)(1) (determined without regard to subparagraph (B)(i) thereof); or

“(B) the first 24-month period—

“(i) consisting of 2 consecutive 12-month periods during each of which the employee has at least 500 hours of service; and

“(ii) by the close of which the employee has attained the age of 21.

“(2) EXCEPTION.—Paragraph (1)(B) shall not apply to any employee described in section 410(b)(3) of the Internal Revenue Code of 1986.

“(3) COORDINATION WITH OTHER RULES.—

“(A) IN GENERAL.—In the case of employees who are eligible to participate in the arrangement or agreement solely by reason of paragraph (1)(B):

“(i) EXCLUSIONS.—An employer may elect to exclude such employees from the application of subsections (a)(4), (k)(3), (k)(12), (k)(13), and (m)(2) of section 401 of the Internal Revenue Code of 1986 and section 410(b) of such Code.

“(ii) NONDISCRIMINATION RULES.—Notwithstanding paragraph (1), section 401(k)(15)(B)(i)(I) of such Code shall apply.

“(iii) TIME OF PARTICIPATION.—The rules of subsection (a)(4) shall apply to such employees.

“(B) TOP-HEAVY RULES.—An employer may elect to exclude all employees who are eligible to participate in a plan maintained by the employer solely by reason of paragraph (1)(B) from the application of the vesting and benefit requirements under subsections (b) and (c) of section 416 of the Internal Revenue Code of 1986.

“(4) 12-MONTH PERIOD.—For purposes of this subsection, 12-month periods shall be determined in the same manner as under the last sentence of subsection (a)(3)(A), except that 12-month periods beginning before January 1, 2022, shall not be taken into account.”.

(b) Vesting.—Section 203(b) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1053(b)) is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) the following new paragraph:

“(4) PART-TIME EMPLOYEES.—For purposes of determining whether an employee who is eligible to participate in a qualified cash or deferred arrangement or a salary reduction agreement under a plan solely by reason of section 202(c)(1)(B) has a nonforfeitable right to employer contributions—

“(A) except as provided in subparagraph (B), each 12-month period for which the employee has at least 500 hours of service shall be treated as a year of service; and

“(B) paragraph (3) shall be applied by substituting ‘at least 500 hours of service’ for ‘more than 500 hours of service’ in subparagraph (A) thereof.

For purposes of this paragraph, 12-month periods shall be determined in the same manner as under the last sentence of section 202(a)(3)(A), except that 12-month periods beginning before January 1, 2022, shall not be taken into account.”.

(c) Effective dates.—Except as provided in paragraph (2), the amendments made by this section shall apply to plan years beginning at least 1 year after final regulations implementing this section are promulgated.

This title may be cited as the “Emergency Savings Act of 2022”.

(a) Employee pension benefit plans.—Section 3 of the Employee Retirement Income Security Act (29 U.S.C. 1002) is amended—

(1) in paragraph (2)(A), by inserting after the first sentence the following: “A pension plan may include a pension-linked emergency savings account.” and

(2) by adding at the end the following:

“(45) PENSION-LINKED EMERGENCY SAVINGS ACCOUNT.—The term ‘pension-linked emergency savings account’ means an account established or maintained by a sponsor of a defined contribution plan for purposes of offering or providing a participant of such plan the opportunity to maintain a short-term savings account that—

“(A) is offered as part of such defined contribution plan;

“(B) accepts only—

“(i) participant contributions which are treated in the same manner as Roth contributions for purposes of inclusion in gross income; and

“(ii) employer contributions which are includible in gross income of the participant for purposes of the Internal Revenue Code of 1986; and

“(C) meets the requirements of part 8 of subtitle B.”.

(b) Pension-linked emergency savings accounts.—

(1) IN GENERAL.—Subtitle B of title I of the Employee Retirement Income Security Act (29 U.S.C. 1021 et seq.) is amended by adding at the end the following:

(2) CLERICAL AMENDMENT.—The table of contents in section 1 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 note) is amended by inserting after the item relating to section 734 the following new items:

(c) Reporting for a pension-linked emergency savings account.—

(1) ALTERNATIVE METHODS OF COMPLIANCE.—Section 110(a) of the Employee Retirement Income Security Act (29 U.S.C. 1030(a)) is amended by inserting “(including pension-linked emergency savings accounts offered in conjunction with a pension plan)” after “class of pension plans”.

(2) MINIMIZED REPORTING BURDEN FOR PENSION-LINKED EMERGENCY SAVINGS ACCOUNTS.—Section 101 of such Act (29 U.S.C. 1021) is amended—

(A) by redesignating subsection (n) as subsection (o); and

(B) by inserting after subsection (m) the following:

“(n) Pension-linked emergency savings accounts.—

“(1) IN GENERAL.—The requirements of subsection (a) shall not apply to a pension-linked emergency savings account made available under section 801.

“(2) SIMPLIFIED REPORTING.—Nothing in this subsection shall preclude the Secretary from providing, by regulations or otherwise, simplified reporting procedures or requirements for such a pension-linked emergency savings account.”.

(d) Fiduciary duty.—Section 404(c) of the Employee Retirement Income Security Act (29 U.S.C. 1104(c)) is amended by adding at the end the following:

“(6) DEFAULT INVESTMENT ARRANGEMENTS FOR A PENSION-LINKED EMERGENCY SAVINGS ACCOUNT.—For purposes of paragraph (1), a participant in a pension-linked emergency savings account shall be treated as exercising control over the assets in the account with respect to the amount of contributions and earnings which are invested in accordance with section 801(b)(1)(C).”.

(e) Joint regulatory authority.—The Secretary of Labor and the Secretary of the Treasury (or a delegate of either such Secretary) shall have authority to issue joint regulations or other guidance, or to coordinate in developing regulations or other guidance, to carry out the purposes of this title, including adjustment of the maximum benefit under section 801(c)(3) of the Employee Retirement Income Security Act, as added by this title, to account for inflation, as well as expansion of corrections programs, if necessary.

Not later than 3 years after the date of enactment of this Act, the Secretary of Labor shall—

(1) review section 2550.404a–5 of title 29, Code of Federal Regulations (relating to fiduciary requirements for disclosure in participant-directed individual account plans);

(2) explore, through a public request for information or otherwise, how the contents and design of the disclosures described in such section may be improved to enhance participants’ understanding of fees and expenses related to a defined contribution plan (as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002)) as well as the cumulative effect of such fees and expenses on retirement savings over time; and

(3) report to the Committee on Health, Education, Labor, and Pensions of the Senate and the Committee on Education and Labor of the House of Representatives on the findings of the exploration described in paragraph (2), including beneficial education for consumers on financial literacy concepts as related to retirement plan fees and recommendations for legislative changes needed to address such findings.

Not later than 2 years after the date of enactment of this Act, the Secretary of Labor and the Secretary of the Treasury (or such Secretaries’ delegates) shall adopt regulations providing that a plan (as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002)) may, but is not required to, consolidate 2 or more of the notices required under sections 404(c)(5)(B) and 514(e)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1104(c)(5)(B) and 29 U.S.C. 1144(e)(3)) and sections 401(k)(12)(D), 401(k)(13)(E), and 414(w)(4) of the Internal Revenue Code of 1986 into a single notice so long as the combined notice—

(1) includes the required content;

(2) clearly identifies the issues addressed therein;

(3) is furnished at the time and with the frequency required for each such notice; and

(4) is presented in a manner that is reasonably calculated to be understood by the average plan participant and that does not obscure or fail to highlight the primary information required for each notice.

(a) Short title.—This section may be cited as the “Information Needed for Financial Options Risk Mitigation Act” or the “INFORM Act”.

(b) In general.—Part 1 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021 et seq.), as amended by section 107, is amended by adding at the end the following:

(c) Clerical amendment.—The table of contents in section 1 of the Employee Retirement Income Security Act of 1974, as amended by section 107(a)(2), is further amended by inserting after the item relating to section 112 the following new item:

Sec. 113. Notice and disclosure requirements with respect to lump sum windows.

(d) Enforcement.—Section 502 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1132) is amended—

(1) in subsection (c)(1), by striking “or section 105(a)” and inserting “, section 105(a), or section 112(a)”; and

(2) in subsection (a)(4), by striking “105(c)” and inserting “section 105(c) or 112(a)”.

(e) Application.—The requirements of section 113 of the ERISA, as added by subsection (b), shall apply beginning on the applicable effective date specified in the final regulations promulgated pursuant to subsection (f).

(f) Regulatory authority.—Not earlier than 1 year after the date of enactment of this Act, the Secretary of Labor and the Secretary of the Treasury shall jointly issue regulations to implement section 113 of the Employee Retirement Income Security Act of 1974, as added by subsection (a). Such regulations shall require plan sponsors to comply in good faith with the regulations beginning not later than 1 year after issuance of a final rule with respect to subsections (a)(1) and (b) of such section 113, and beginning not later than 6 months after issuance of a final rule with respect to subsections (a)(2), (c), (d), and (e) of such section 113.

(a) In general.—Section 101(f)(2)(B) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021(f)(2)(B)) is amended—

(1) in clause (i)(I), by striking “funding target attainment percentage (as defined in section 303(d)(2))” and inserting “percentage of plan liabilities funded (as described in clause (ii)(I)(bb))”;

(2) in clause (ii)(I)—

(A) by striking “, a statement of”;

(B) by striking item (aa);

(C) by redesignating item (bb) as item (aa);

(D) in item (aa), as so redesignated—

(i) by inserting “a statement of” before “the value” and

(ii) by striking “and” at the end; and

(E) by adding at the end the following:

“(bb) a statement of the percentage of plan liabilities funded, calculated as the ratio between the value of the plan’s assets and liabilities, as determined under item (aa), for the plan year to which the notice relates and for the 2 preceding plan years, and

“(cc) if the information in (aa) and (bb) is presented in tabular form, a statement that describes that in the event of a plan termination the corporation’s calculation of plan liabilities may be greater and that references the section of the notice with the information required under clause (x), and”;

(3) in clause (iii), in the matter preceding subclause (I), by inserting “for the plan year to which the notice relates as of the last day of such plan year and the preceding 2 plan years, in tabular format,” after “participants”;

(4) in clause (iv)—

(A) by striking “plan and the asset” and inserting “plan, the asset”; and

(B) by inserting “, and the average return on assets for the plan year,” after “assets)”;

(5) by redesignating clauses (ix) through (xi) as clause (x) through (xii), respectively;

(6) by inserting after clause (viii) the following:

“(ix) in the case of a single-employer plan, a statement as to whether the plan’s funded status, based on the plan’s liabilities described under subclause (II) for the plan year to which the notice relates, and for the 2 preceding plan years, is at least 100 percent (and, if not, the actual percentages), that includes—

“(I) the plan’s assets, as of the last day of the plan year and for the 2 preceding plan years, as determined under clause (ii)(I)(aa),

“(II) the plan’s liabilities, as of the last day of the plan year and for the 2 preceding plan years, as determined under clause (ii)(1)(aa), and

“(III) the funded status of the plan, determined as the ratio of the plan’s assets and liabilities calculated under subclauses (I) and (II), for the plan year to which the notice relates, and for the 2 preceding plan years,”; and

(7) in clause (x), as so redesignated, by striking the comma at the end and inserting the following: “and a statement that, in the case of a single-employer plan—

“(I) if plan assets are sufficient to pay vested benefits that are not guaranteed by the Pension Benefit Guaranty Corporation, participants and beneficiaries may receive benefits in excess of the guaranteed amount, and

“(II) in determining valuation of guaranteed benefits, the Pension Benefit Guaranty Corporation uses, as of the date of enactment of the RISE & SHINE Act, a valuation methodology that—

“(aa) places a higher value on the future cost of benefits than any valuation methodology required under Federal statute, and

“(bb) makes it less likely that participants and beneficiaries will receive amounts in excess of the guaranteed amount under Federal law,”.

(b) Effective date.—The amendments made by subsection (a) shall apply with respect to plan years beginning after December 31, 2023.

(a) Eligible automatic contribution arrangements.—Section 514(e)(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1144(e)(2)) is amended—

(1) by redesignating subparagraphs (A) through (C) as clauses (i) through (iii), respectively, and by moving such clauses 2 ems to the right;

(2) by striking “(2) For purposes of” and inserting “(2)(A) For purposes of”; and

(3) by adding at the end the following:

“(B) In the case of an automatic contribution arrangement taking effect after December 31, 2024, the requirements of subparagraph (A)(ii) shall be treated as met only if, under the arrangement, at least every 3 plan years but not more than once annually each employee—

“(i) who is eligible to participate in the arrangement; and

“(ii) who, at the time of the determination, has in effect an affirmative election pursuant to subparagraph (A)(ii) not to have any contributions described in such subparagraph made;

is treated as having made the election at the uniform percentage of compensation described in subparagraph (A)(ii) unless the employee makes a new election under such subparagraph. Such determination may be made at one time for all employees described in the preceding sentence for a plan year, regardless of individual employee dates of enrollment.”.

(b) Effective date.—The amendments made by this section shall apply to arrangements taking effect after December 31, 2024.

(a) Findings.—Congress finds the following:

(1) Retirement plan sponsors engage advisors to assist in administering their retirement plans. Such advisors and other service providers are paid via monthly or annual retainers to advise on plan administration or the investment fund lineup. Such retainers are charged to the retirement plan.

(2) Other, incidental expenses incurred related to plan design, may not be charged to the plan because they are deemed settlor functions. For example, if a plan sponsor were to inquire about a beneficial plan design feature, such as automatic enrollment and reenrollment or automatic escalation, the advisor or other service provider would bill the employer a separate amount that could not be charged back to the plan. Because these inquiries result in additional costs, many employers, especially small employers, choose to forego these incidental plan design features, even when they might generate tremendous benefits for their employees.

(3) According to the 2021 Plan Sponsor Council of America’s Annual Survey of Profit Sharing and 401(k) Plans, only 30.5 percent of employers with fewer than 50 workers have an automatic enrollment feature in their retirement plan, compared to over 77 percent of employers with more than 1,000 workers. Small employers need additional resources to improve their retirement plan design.

(b) Facilitating the implementation of beneficial plan features.—

(1) PLAN ASSETS.—Section 403(c)(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1103(c)(1)) is amended by inserting “(including incidental expenses solely for the benefit of the participants and their beneficiaries)” before the period.

(2) FIDUCIARY STANDARD OF CARE.—Section 404(a)(1)(A)(ii) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1104(a)(1)(A)(ii)) is amended by inserting “(including incidental expenses solely for the benefit of the participants and their beneficiaries)” before the semicolon.

The Secretary of Labor shall—

(1) conduct a study on the pooled employer plan (as such term is defined in section 3(43) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(43))) industry, including on—

(A) the legal name and number of pooled employer plans;

(B) the number of participants in such plans;

(C) the range of investment options provided in such plans;

(D) the fees assessed in such plans;

(E) the manner in which employers select and monitor such plans;

(F) the disclosures provided to participants in such plans;

(G) the number and nature of any enforcement actions by the Secretary of Labor on such plans;

(H) the extent to which such plans have increased retirement savings coverage in the United States; and

(I) any additional information as the Secretary determines is necessary; and

(2) not later than 5 years after the date of enactment of this Act, and every 5 years thereafter, submit to Congress and make available on a publicly accessible website of the Department of Labor, a report on the findings of the study under paragraph (1), including recommendations on how pooled employer plans can be improved, through legislation, to serve and protect retirement plan participants.

Section 202(a) of the Setting Every Community Up for Retirement Enhancement Act of 2019 (Public Law 116–94; 26 U.S.C. 6058 note) is amended—

(1) by striking “so that all members” and inserting the following: “so that—

“(1) all members”;

(2) by striking the period and inserting “; and”; and

(3) by adding at the end the following:

“(2) any opinions required by section 103(a)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1023(a)(3)) shall relate only to each individual plan which would otherwise be subject to the requirements of such section 103(a)(3).”.

(a) Amendment of Internal Revenue Code of 1986.—Section 414 of the Internal Revenue Code of 1986, as amended by the preceding sections of this Act, is further amended by adding at the end the following new subsection:

“(bb) Projected interest crediting rate.—For purposes of this part, in the case of an applicable defined benefit plan (as defined in section 411(a)(13)(B)) which provides variable interest crediting rates, the interest crediting rate which is treated as in effect and as the projected interest crediting rate shall be a reasonable projection of such variable interest crediting rate, not to exceed 6 percent.”.

(b) Amendment of Employee Retirement Income Security Act of 1974.—Section 210 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1060) is amended by adding at the end the following new subsection:

“(g) Projected interest crediting rate.—For purposes of this title, in the case of an applicable defined benefit plan (within the meaning of section 203(f)(3)) which provides variable interest crediting rates, the interest crediting rate which is treated as in effect and as the projected interest crediting rate shall be a reasonable projection of such variable interest crediting rate, not to exceed 6 percent.”.

(c) Effective date.—The amendments made by this section shall apply with respect to years beginning after the date of enactment of this Act.

(a) In general.—Paragraph (8) of 4006(a) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1306(a)) is amended by—

(1) in subparagraph (A)—

(A) in clause (vi), by striking “and”;

(B) in clause (vii), by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following:

“(viii) for plan years beginning after calendar year 2022, $48.”;

(2) in subparagraph (B), in the matter preceding clause (i), by inserting “and before 2023” after “2012” ; and

(3) in subparagraph (D)(vii), by inserting “and before 2023” after “2019”.

(b) Technical amendment.—Clause (i) of section 4006(a)(3)(E) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1306(a)(3)(E)) is amended by striking “subparagraph (H)” and inserting “subparagraph (I)”.

(a) Extension of transfers of excess pension assets to retiree health accounts under the Internal Revenue Code of 1986.—Paragraph (4) of section 420(b) of the Internal Revenue Code of 1986 is amended by striking “December 31, 2025” and inserting “December 31, 2032”.

(b) Extension of transfers of excess pension assets to retiree health accounts under the Employee Retirement Income Security Act of 1974.—

(1) DEFINITIONS.—Section 101(e)(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021(e)(3)) is amended by striking “(as in effect on the date of the enactment of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015)” and inserting “(as in effect on the date of enactment of the RISE & SHINE Act)”.

(2) USE OF ASSETS.—Section 403(c)(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1103(c)(1)) is amended by striking “(as in effect on the date of the enactment of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015)” and inserting “(as in effect on the date of enactment of the RISE & SHINE Act)”.

(3) EXEMPTION.—Section 408(b)(13) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1108(b)(13)) is amended—

(A) by striking “January 1, 2026” and inserting “January 1, 2033”; and

(B) by striking “(as in effect on the date of the enactment of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015)” and inserting “(as in effect on the date of enactment of the RISE & SHINE Act)”.

(c) Effective date.—The amendments made by this section shall apply to transfers made after the date of enactment of this Act.

(a) In general.—Part 2 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021 et seq.) is amended—

(1) by redesignating section 211 as section 212; and

(2) by inserting after section 210 the following new section:

(b) Clerical amendment.—The table of contents in section 1 of the Employee Retirement Income Security Act of 1974 is amended by striking the item relating to section 211 and by inserting after the item relating to section 210 the following new items:

“Sec. 211. Plan amendments due to the RISE & SHINE Act.
“Sec. 212. Effective dates.”.

(a) Short title.—This section may be cited as the “Worker Ownership, Readiness, and Knowledge Act” or the “WORK Act”.

(b) Definitions.—In this section:

(1) EXISTING PROGRAM.—The term “existing program” means a program, designed to promote employee ownership, that exists on the date on which the Secretary is carrying out a responsibility authorized under this section.

(2) INITIATIVE.—The term “Initiative” means the Employee Ownership Initiative established under subsection (c).

(3) NEW PROGRAM.—The term “new program” means a program, designed to promote employee ownership, that does not exist on the date on which the Secretary is carrying out a responsibility authorized under this section.

(4) SECRETARY.—The term “Secretary” means the Secretary of Labor.

(5) STATE.—The term “State” has the meaning given the term under section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(c) Employee ownership initiative.—

(1) ESTABLISHMENT.—The Secretary shall establish within the Department of Labor an Employee Ownership Initiative to promote employee ownership.

(2) FUNCTIONS.—In carrying out the Initiative, the Secretary shall—

(A) support within the States existing programs designed to promote employee ownership; and

(B) facilitate within the States the formation of new programs designed to promote employee ownership.

(3) DUTIES.—To carry out the functions enumerated in paragraph (2), the Secretary shall—

(A) support new programs and existing programs by—

(i) making Federal grants authorized under subsection (e); and

(ii) (I) acting as a clearinghouse on techniques employed by new programs and existing programs within the States, and disseminating information relating to those techniques to the programs; or

(II) funding projects for information gathering on those techniques, and dissemination of that information to the programs, by groups outside the Department of Labor; and

(B) facilitate the formation of new programs, in ways that include holding or funding an annual conference of representatives from States with existing programs, representatives from States developing new programs, and representatives from States without existing programs.

(d) Programs regarding employee ownership.—

(1) ESTABLISHMENT OF PROGRAM.—Not later than 180 days after the date of enactment of this Act, the Secretary shall establish a program to encourage new programs and existing programs within the States to foster employee ownership throughout the United States.

(2) PURPOSE OF PROGRAM.—The purpose of the program established under paragraph (1) is to encourage new and existing programs within the States that focus on—

(A) providing education and outreach to inform employees and employers about the possibilities and benefits of employee ownership and business ownership succession planning, including providing information about financial education, employee teams, open-book management, and other tools that enable employees to share ideas and information about how their businesses can succeed;

(B) providing technical assistance to assist employee efforts to become business owners, to enable employers and employees to explore and assess the feasibility of transferring full or partial ownership to employees, and to encourage employees and employers to start new employee-owned businesses;

(C) training employees and employers with respect to methods of employee participation in open-book management, work teams, committees, and other approaches for seeking greater employee input; and

(D) training other entities to apply for funding under this subsection, to establish new programs, and to carry out program activities.

(3) PROGRAM DETAILS.—The Secretary may include, in the program established under paragraph (1), provisions that—

(A) in the case of activities described in paragraph (2)(A)—

(i) target key groups, such as retiring business owners, senior managers, labor organizations, trade associations, community organizations, and economic development organizations;

(ii) encourage cooperation in the organization of workshops and conferences; and

(iii) prepare and distribute materials concerning employee ownership, and business ownership succession planning;

(B) in the case of activities described in paragraph (2)(B)—

(i) provide preliminary technical assistance to employee groups, managers, and retiring owners exploring the possibility of employee ownership;

(ii) provide for the performance of preliminary feasibility assessments;

(iii) assist in the funding of objective third-party feasibility studies and preliminary business valuations, and in selecting and monitoring professionals qualified to conduct such studies; and

(iv) provide a data bank to help employees find legal, financial, and technical advice in connection with business ownership;

(C) in the case of activities described in paragraph (2)(C)—

(i) provide for courses on employee participation; and

(ii) provide for the development and fostering of networks of employee-owned companies to spread the use of successful participation techniques; and

(D) in the case of training described in paragraph (2)(D)—

(i) provide for visits to existing programs by staff from new programs receiving funding under this section; and

(ii) provide materials to be used for such training.

(4) GUIDANCE.—The Secretary shall issue formal guidance, for—

(A) recipients of grants awarded under subsection (e) and one-stop partners (as defined in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102)) affiliated with the workforce development systems (as so defined) of the States, proposing that programs and other activities funded under this section be—

(i) proactive in encouraging actions and activities that promote employee ownership of businesses; and

(ii) comprehensive in emphasizing both employee ownership of businesses so as to increase productivity and broaden capital ownership; and

(B) acceptable standards and procedures to establish good faith fair market value for shares of a business to be acquired by an employee stock ownership plan (as defined in section 407(d)(6) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1107(d)(6))).

(e) Grants.—

(1) IN GENERAL.—In carrying out the program established under subsection (d), the Secretary may make grants for use in connection with new programs and existing programs within a State for any of the following activities:

(A) Education and outreach as provided in subsection (d)(2)(A).

(B) Technical assistance as provided in subsection (d)(2)(B).

(C) Training activities for employees and employers as provided in subsection (d)(2)(C).

(D) Activities facilitating cooperation among employee-owned firms.

(E) Training as provided in subsection (d)(2)(D) for new programs provided by participants in existing programs dedicated to the objectives of this section, except that, for each fiscal year, the amount of the grants made for such training shall not exceed 10 percent of the total amount of the grants made under this section.

(2) AMOUNTS AND CONDITIONS.—The Secretary shall determine the amount and any conditions for a grant made under this subsection. The amount of the grant shall be subject to paragraph (6), and shall reflect the capacity of the applicant for the grant.

(3) APPLICATIONS.—Each entity desiring a grant under this subsection shall submit an application to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may reasonably require.

(4) STATE APPLICATIONS.—Each State may sponsor and submit an application under paragraph (3) on behalf of any local entity consisting of a unit of State or local government, State-supported institution of higher education, or nonprofit organization, meeting the requirements of this section.

(5) APPLICATIONS BY ENTITIES.—

(A) ENTITY APPLICATIONS.—If a State fails to support or establish a program pursuant to this section during any fiscal year, the Secretary shall, in the subsequent fiscal years, allow local entities described in paragraph (4) from that State to make applications for grants under paragraph (3) on their own initiative.

(B) APPLICATION SCREENING.—Any State failing to support or establish a program pursuant to this section during any fiscal year may submit applications under paragraph (3) in the subsequent fiscal years but may not screen applications by local entities described in paragraph (4) before submitting the applications to the Secretary.

(6) LIMITATIONS.—A recipient of a grant made under this subsection shall not receive, during a fiscal year, in the aggregate, more than the following amounts:

(A) For fiscal year 2024, $300,000.

(B) For fiscal year 2025, $330,000.

(C) For fiscal year 2026, $363,000.

(D) For fiscal year 2027, $399,300.

(E) For fiscal year 2028, $439,200.

(7) ANNUAL REPORT.—For each year, each recipient of a grant under this subsection shall submit to the Secretary a report describing how grant funds allocated pursuant to this subsection were expended during the 12-month period preceding the date of the submission of the report.

(f) Evaluations.—The Secretary is authorized to reserve not more than 10 percent of the funds appropriated for a fiscal year to carry out this section, for the purposes of conducting evaluations of the grant programs identified in subsection (e) and to provide related technical assistance.

(g) Reporting.—Not later than the expiration of the 36-month period following the date of enactment of this Act, the Secretary shall prepare and submit to Congress a report—

(1) on progress related to employee ownership in businesses in the United States; and

(2) containing an analysis of critical costs and benefits of activities carried out under this section.

(h) Authorizations of appropriations.—

(1) IN GENERAL.—There are authorized to be appropriated for the purpose of making grants pursuant to subsection (e) the following:

(A) For fiscal year 2024, $4,000,000.

(B) For fiscal year 2025, $7,000,000.

(C) For fiscal year 2026, $10,000,000.

(D) For fiscal year 2027, $13,000,000.

(E) For fiscal year 2028, $16,000,000.

(2) ADMINISTRATIVE EXPENSES.—There are authorized to be appropriated for the purpose of funding the administrative expenses related to the Initiative, for each of fiscal years 2022 through 2026, an amount not in excess of the lesser of—

(A) $350,000; or

(B) 5.0 percent of the maximum amount available under paragraph (1) for that fiscal year.