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DOL Guidance for Locating Missing Participants

The Employee Benefit Security Administration (EBSA) of the Department of Labor issued guidance to plan fiduciaries (for both defined benefit and defined contribution plans) for locating participants and distributing unclaimed payments.

Field Assistance Bulletin 2021‐01, entitled “Missing Participants – Best Practices for Pension Plans” provides specific recommendations and implementation strategies.

Plan fiduciaries should develop best practices and establish a “culture of fiduciary compliance” which include:

  • Maintaining accurate participant records, and periodically confirming and updating address, phone numbers, email address, emergency contact information, and other contact details.
  • Ensuring effective communication strategies are enacted and participants are encouraged to maintain contact with the plan sponsor, both during and after their employment tenure.
  • Engaging in a multi‐pronged approach to search for missing participants, using information from multiple plan sponsor databases, beneficiary or emergency contact information, online search engines, public data bases, and social media. A commercial locator service or proprietary search tools can also be used to find individuals. The bulletin also suggests contacting co‐workers or union representatives and adding names to national location finding registries.
  • Utilizing a multi‐pronged approach to contacting missing participants, including contact via certified mail or similar mail tracking systems, email, text, and social media.
  • For participants that are unresponsive, checking the Social Security Death Index, and redirecting communication to beneficiaries in the event of a participant’s death.
  • Ensuring all procedures and actions taken are properly documented and converted into consistent practices.

The bulletin indicates that fiduciaries should prioritize which best practices have the greatest impact and are the most cost effective, given the number of participants. Plan fiduciaries should not only correct potential database problems but should address gaps in policies or procedures to better handle returned participant communication or uncashed checks.

Critics say the DOL did not go far enough in stating which of the best practices fulfills fiduciary obligations and the guidance raises privacy concerns when contacting co‐workers, beneficiaries, and emergency contacts.