Videos and Webinars

Seven New Releases for a Safer, Smarter, Easier Experience

Oct 21, 2019



In this webinar, discover what's new and what's to come across Newport Group's entire suite of products and services, including:
  • Cybersecurity and fraud prevention
  • New 3(16) Services
  • Force Out Distribution Process
  • Payroll Integration
  • Stale Dated Check Process and more
Discover how these new and enhanced resources benefit your retirement plan and participants.

Click here to download a copy of this presentation. 
Click here to see the latest quarterly spotlight update.

Transcription

Karla Pedretti: Thank you to all our clients who took time today to join the webinar. I'd also like to do a special shout out to Buck for being my cohost this afternoon. We wanted to have this webinar because we're constantly releasing updates to our products and services for a lot of reasons, including increasing cyber security, which is a very high priority for Newport Group. Some of these enhancements we're going to talk about will make your job easier and will make the plan run smoother. Some are to help comply with regulations. They're all important to running your plan, and we're committed to communicating these enhancements to you in multiple ways. You may have read the latest edition of Plan Facts, which led with a quarterly product review. As Michael said, Plan Facts is available in the handout section of your control panel for you to download now. Next quarter, you'll see another quarterly product review with newer enhancements, but let's stick to today's topics.

Karla Pedretti: So, today, as Michael said, nothing scary, just good stuff for everybody. We're going to talk about 3(16) services. This is the service we offer that lightens and shares the fiduciary load and will make management of your plan easier. The HR departments that we currently work with that use this service are very, very happy with it, and I'll tell you more about that in just a minute here. Hardship withdrawals. The rules have changed, making the administration easier and making more funds available to the participants. All very good things. Spanish offerings. This is an enhancement that many of our clients have asked for, and if your employee population has Spanish speakers, stay tuned.

Karla Pedretti: Payroll integration. We know transmitting files can be time-consuming for our clients, and we're striving to make this easy and offer options to you. As we just saw from the poll, most of the attendees in this session are self-serving with their payroll files, and we want to talk a little bit about payroll integration. Then, our last three subjects, sponsor reporting, stale dated check process and sponsor notifications are enhancements that will make the day-to-day running of your plan easier. We're excited to bring you the details, so I'll jump right into the 3(16) fiduciary services.

Karla Pedretti: We began offering 3(16) services to new clients a little over a year ago, and the clients that use this service have been very pleased with the reduction in administrative work. Under our 3(16) services, Newport will assume responsibility for a number of administrative tasks, such as sending enrollment materials directly to plan participants upon eligibility and mailing the summary annual reports that are required to be distributed every year. We also approve incoming rollovers, distribution requests and loan requests, making these transactions happen very quickly and without requiring you as the plan sponsor to set aside other tasks to review and approve these requests.

Karla Pedretti: For those of you that have had to review hardship requests or help an employee work through a domestic relations order as they're going through a divorce, I'm excited to share with you that under our 3(16) services, Newport will determine eligibility for a hardship and also approve the hardship. It is so much better for employee relations to have a third party communicate with the participants in the event they're not able to take a hardship. It's also easier for the participant to talk to someone other than their employer about a situation that may have put them in a poor financial position. It's also difficult for employers to stay on top of the regulations around hardship withdrawals.

Karla Pedretti: In my next section, I'm going to talk about some major changes to the regulations, and I think this will be a good example of why you might want to use Newport's 3(16) service. We'll also review, approve and process qualified domestic relations orders or QDRO. Oftentimes, the settlements of finances during a divorce, very time consuming, a lot of back and forth between the employee, their spouse and the lawyers. Newport Group will communicate directly with the interested parties so that you have more time to focus on paths that more closely align with the success of your business rather than approving a QDRO for an employee. I've described the services that our sponsors really enjoy because of the reduction of work they offer, but there are more that are covered under 3(16). So, if you'd like a list of our full 3(16) services, simply reach out to your dedicated client service manager who is ready to have those conversations with you about your plan.

Karla Pedretti: Our next topic is hardship withdrawals. I talked earlier about the challenges that employers face trying to stay on top of the regulations and why you would want to rely on our expertise. Hardship withdrawals is a really good example. Recently, regulations were finalized that are definitely beneficial to employees who want to take a hardship withdrawal. One of the biggest changes is that employees no longer need to be suspended from making contributions after they take a hardship. This is really good news because it means they can withdraw the money that they need to satisfy their immediate obligations, but they can continue to contribute to the plan and keep moving towards retirement readiness. Previously, it was a bit of a double whammy for participants because not only would they reduce their plan balance by taking the hardship, they also couldn't start building their account back up for six months, and that's no longer the case.

Karla Pedretti: Another big change is that participants are no longer required to take available taxable loans before they can take a hardship. The new regulations allow for additional sources to be included in the money that can be withdrawn for a hardship. So, for a 401k plan, this means that earnings on the 401k deferrals can be included now, and if the plan has a qualified nonelective contribution or a qualified matching contribution, those are also able to be included in the amount that a participant can take out for a hardship. Good news, also, the IRS has expanded some reasons that a participant can take a hardship withdrawal. Those reasons now include any casualty loss and expenses that may have been incurred as a result of a federally-declared disaster, including loss of wages.

Karla Pedretti: Earlier this year, we implemented procedural changes that match these more beneficial options and are communicating these out to our plan sponsors. If you use our documents services, we'll be providing you with an amendment by the end of 2019. If you use someone other than Newport Group for your document provider, please contact your Newport relationship manager before you work with your document provider to ensure we're all in alignment with the changes. Remember, we do offer hardship review and approval under our 3(16) services, so you don't have to be encumbered with trying to remember not only all of these changes, but staying thing on top of other hardship changes as they may come down the pike here.

Karla Pedretti: Next up, Buck is going to talk about our enhanced Spanish offering.

Buck Wendel: Thanks, Karla. Newport is pleased to announce the Spanish language offering for participants. This offering includes the translation of the website after login as well as delivery of statements in Spanish. The translation of the website is first enabled at the plan level. If you're interested in doing so, please contact your dedicated client service manager. When enabled, a participant can toggle between language settings. The toggle option is located in the My Profile section of the participant website. Whenever the option is elected, that selection will become the default moving forward. Participants can switch back at any time by going back into the My Profile section. If a participant has multiple accounts in Newport Group, this setting will apply across all accounts. As I mentioned in a prior slide, the language offering covers statements as well. This feature's also enabled in the My Profile section of the participant website. Once enabled, the default language will be displayed on the quarterly statement. It will not, however, change the language displayed for on demand statements. When a participant logs out, the website will revert to English as the setting does not apply outside of the login.

Karla Pedretti: All right. The fourth of our seven topics is payroll offering. At the beginning of the call, we committed to providing solutions that would make the administration of the plan easier and give you options. Creating and transmitting sensitive files, or as they're commonly called, payroll files, is an area we hear clients spend a lot of time on. We built three different options to help: self-serve, payroll integration and Newport Group payroll service. The one that our clients really like and the one that we want to focus on today is payroll integration. Payroll integration is basically Newport and your payroll vendor interacting with each other to transmit information back and forth. That's removing you from the center of that process. There are two types of payroll integration, 180 and 360.

Karla Pedretti: 180 refers to the transmission of data from the payroll vendor to Newport. For a plan that uses 180, the sponsor uses Newport's HRIS files to make changes on the payroll system for participant changes, such as deferral rates or setting up loan payments for a new loan. Once the payroll's finalized, the payroll vendor then transmits that file directly to Newport Group on behalf of the sponsor. We currently have connectivity with four major payroll vendors for 180 payroll integration.

Karla Pedretti: The other type of payroll integration is 360. This means that Newport transmits changes directly to the payroll vendor who incorporates those changes into the payroll system. Then, the payroll vendor transmits the finalized payroll back to Newport Group for processing. We connect with two major payroll vendors for 360 payroll integration today.

Karla Pedretti: In both cases, the vendor will make available a payroll file to the plan sponsor for their records. If you'd like to learn more about which vendors we do currently work with, please contact your relationship manager. We're continuously evaluating our opportunities to add more vendors, so even if we don't have a relationship with a specific vendor today, we'd like to hear about your needs. So, we encourage you to contact your relationship manager and we'll take a look at that opportunity.

Karla Pedretti: In keeping with our commitment to make your life smoother, our next three topics cover more enhancements we've made that will do exactly that. Buck's going to start with sponsor reporting.

Buck Wendel: Newport Group has made several enhancements to our on demand reporting. This covers several of the reports that can be accessed as a single report, on a schedule or run as a package with other reports. The enhancements include the address change summary report was updated to include a date and timestamp for each address change. We created a new enhanced loan activity report that breaks down loan payments, including the beginning balance, new loans, total payments, interest that's paid during the period and ending balance. We create a loan history report that will give a detailed listing of a participant's loan payments over the life of the loan by payment date with the breakdown of principal and interest paid for each payment.

Buck Wendel: We also created a participants with late loan report that will give a detailed listing of loans that have late loan payments. This report breaks out loans based on two timeframes, the 45 to 90-day timeframe and the 91 or more days. This time determination is based on the date of the last loan payment. We've created a census-by-date range report that will provide payroll information by a plan or specific date range. We updated some of our activity reports covering the reports listed here to include loan activity forfeiture and expense accounts. We started reporting dividends separate from the gain/loss for funds.

Buck Wendel: For a plan that offers a managed model solution, we've released the fund balance summary with models report. This report will offer a summary of assets in the plan, including balances by model and balances by fund outside of the model. Lastly, we updated our HRS reports with new loan information. The reports will now report the loan setup date versus the origination dates. Sometimes, those dates can be different. The report will also break up the principal amount taken for the loan, the interest to be paid over the life of the loan and the total goal amount of the loan.

Karla Pedretti: Our next item makes it not only easier to administer the plan, but it also helps plan sponsors satisfy their fiduciary obligation to plan participants. The stale dated check process gives you back valuable time and lets Newport do all the heavy lifting. We've had preliminary conversations with some of our clients about the process, and all of them have indicated that they think it will be a huge time saver for them. Let's go through the process. I think you'll also agree it will make your life easier, too. On a monthly basis, we will prepare a distribution report and post it to the plan sponsor site of digital client access. When we post the report, we will send you an email letting you know that the report is available for your review.

Karla Pedretti: You need to review the report, and if you have an updated mailing address for someone who has a stale dated check and is on the report, just let us know. We'll interact directly with that participant by sending them a letter, giving them the instructions on how to request a reissued check. Sometimes, we are still in possession of the check, and if that's the case, we can attempt to redeliver the check back to the participant. But if you don't have an updated mailing address, just ask your Newport relationship manager to perform a participant search for you. We have access to a database for this purpose and we can do that search without there being any cost to you. Any check that remains outstanding after 180 days will be redeposited back into the plan trust account in the participant's account and will be reinvested into the plans' QEIA or default fund.

Karla Pedretti: Our last topic today before we get to our question and answer section is reporting.

Buck Wendel: So, our sponsors notification page provides plan sponsors and financial advisers email notifications of various plan activities. Notifications are sent out once a day and combine participants by a plan activity. As an example, if you're doing enrollment meetings and multiple participants enroll or change their contribution rate, they'll be reported on one notification provided the changes occurred on the same day. If you were doing multiple enrollment meetings covering multiple days, then they would be reported by the day that they occurred.

Buck Wendel: The notifications cover several different activities. The deferral election change will notify you of any deferral contribution rate changes. The loan delinquent notification provides details of participant loans that have not made a payment within 45 days. The hardship begins will indicate when a hardship has begun or started and end when it's ended. For loan processed, that notification will detail the loan parameters of a new loan that was processed and will give you the indication to update your payroll system to begin deductions. The loan requested will give you a notification for any loan requests that requires approval before they are processed. Lastly, we've released the payroll past due notification. This notification will be generated when a payroll is deemed 10 calendar days past due. Prior to year end, this notification does get generated when a payroll is deemed to be three business days past due.

Karla Pedretti: Excellent. As Michael said, we've been accepting questions. Michael, I see we have some really good questions. You want to read through some of these and Buck and I will answer them for the group?

Michael: Absolutely, Karla. You're right. We've gotten a lot of questions in. Just for our attendees, you can continue to enter your questions in the question pane that's in that control panel that we mentioned earlier. We'll get to as many questions today as we have time for. This first one, Karla, I think this would be for you. "What are the benefits to a plan if an ACH pull is authorized?"

Karla Pedretti: Ah, good question. I think this question probably was triggered during the payroll integration section. The main benefit to having Newport pull the funds via ACH is ... First of all, it's one less thing that you as the plan sponsor have to remember to do. The process is automated on our end, so once the file is received and in good order and processed, we'll send the request to your bank for the funds. The second good thing is that there's no more opportunity for forgetting to fund a payroll. Again, one less thing you have to remember to do.

Michael: The next question we've gotten in, and again, I think this one's for you, Karla, "How can I sign up for 3(16) services and how long does it take to transfer responsibility?"
Karla Pedretti:    Oh, thank you for that question. Very easy to sign up for these services. All you have to do is contact your relationship manager. They'll immediately begin an assessment. The amount of time that it takes for us to be able to transfer the responsibilities over is different for each plan. It's dependent on the current plan provisions and functionality that the plan may already be utilizing.

Michael: Okay. This question, I think ... I think this is for you, Buck. "Have you created any reports that will make audit reconciliation easier?"

Buck Wendel: That's a great question, Michael. Several of the reports that I detailed earlier do help out with audits. The most prevalent ones or the most feedback we've received is the enhanced loan activity report, which does report loans by ID or by loan number and gives you a full breakdown of the activity that occurred. The second is the census-by-date range report. This allows an auditor to reconcile the information that was loaded to the Newport system versus a payroll information. So, you run the report by date range and it'll give you contributions by source. It would give you compensation and hours that were reported during the period.

Michael: Looking at this next question, I believe this would go to Karla. "Do the hardship changes impact 401k and 403b plans the same?"

Karla Pedretti: As of now, the changes are only applicable to the 401k plan, so not on the 403B at this time, Michael.

Michael:  Good to know. Next question. Again, I think this is for Karla. "How can I get more information on hardship withdrawals in light of the new guidance that was just released?"

Karla Pedretti:  Great question. Newport Group is either sending or will be sending, depending on a different legacy organization, which more information out on the hardship changes, once you get that email, we'll have links in there that you can use to get additional information, but also, you can reach out to your client service manager for any clarifying questions that you might have.

Michael: Karla, here's another one for you. Let's see. "We are really interested in payroll integration. Are there any particular payroll vendors where you have already established integration?"

Karla Pedretti: Yes. There are some vendors that we have already established that integration with. As one might imagine, we work with a vast majority of providers due to the very nature of our client base. Each plan sponsor's payroll layout may be unique, and depending on whichever vendor is used, we have a one-on-one conversation with that payroll vendor. But again, our client service managers are very prepared to help with that conversation.

Michael: Next question. Buck, I think this is for you. This is one of the topics that you were speaking to. "I'm really excited to see new sponsor reporting and web notifications. I think it's going to help me in administering the plan. How can I get more information on these reports and notification and what's the process for having them enabled for me?"

Buck Wendel:  Thanks for the feedback. We're really excited about being able to offer more functionality and customization for our plan sponsors so they can receive the information most relevant for the administration of your plan. With respect to getting more information, we would encourage you to reach out to your dedicated client service manager. They can work with you to better explore the various options then to enable the desired reporting and notification.

Michael:  Thanks, Buck. I think we have time for ... I'm looking at the clock. We have time for one more question. Karla, this one looks to be for you. "As the plan sponsor, do I have any responsibility to manage stale dated checks? I thought my fiduciary responsibility ended after we issued payment to a participant?"

Karla Pedretti: Mm-hmm (affirmative). Yeah. I'm not really surprised this question was asked in the webinar. We actually hear this question frequently from our plan sponsors. Believe it or not, until the check is cashed by the participant, the plan sponsor does retain fiduciary responsibility as the money hasn't technically left the plan. As you know and as Newport Group has discussed on prior client webinars, the DOL increased the preview of lost participants, and it's critically important for plan sponsors to maintain oversight of those stale dated checks. Our enhanced process here combined with our ability to help perform lost participant searches should help our plan sponsors fulfill their fiduciary responsibility.

Michael:  That sounds great, Karla. Karla, Buck, thank you both so much. This was great information. We really appreciate it. To our attendees, just as we wrap up, a few quick items. As Karla mentioned earlier in the webinar, we're making continuous enhancements to our service offering and we'll be summarizing all of these changes each quarter in Plan Facts. That's our newsletter, our quarterly newsletter, for plan sponsor clients. Our most recent version of Plan Facts is downloadable in the control panel here on the screen. It's in that handout section. So, if you missed that edition or you want to reread it, please go ahead and download it. Our next issue of Plan Facts will be available in December. If you're not receiving Plan Facts, it's a great resource, and you can contact your relationship manager or send a footnote to Newport Group at NewportGroup.com and we'll get you signed up. You have questions specific to your plan, please reach out to your relationship manager.

Michael: You can also, before I forget, you can download all of these slides from today's presentation as well. Everyone on the call who received an email or who signed up for the webinar, excuse me, you'll receive an email in the near future with a link to a replay, and you can feel free to share that with your colleagues when you get that email. Lastly, and important for us, when you exit the webinar, you'll see two quick questions. If you can take just a moment to answer them. This will help us continue to bring topics of interest to you. That's really important to us. So, if you can do that, that would be great. With that, thank you so much for your time. We really appreciate it. We will see you next quarter. Have a great day.

 

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Newport Group, Inc. and its affiliates provide recordkeeping, plan administration, trust and custody, consulting, fiduciary consulting, insurance and brokerage services. Fiduciary consulting services are provided through Newport Group Securities, Inc., an SEC-registered investment adviser and FINRA-registered broker-dealer, and InterServ, LLC, an SEC-registered investment adviser. Newport Group Securities, Inc. and InterServ, LLC are affiliates of Newport Group, Inc. All securities transactions are provided through Newport Group Securities, Inc., in its role as broker-dealer. All fiduciary consulting services are provided through the registered investment adviser. when offering variable insurance products, Newport Group Securities, Inc. acts solely in its capacity as a broker-dealer.
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