One of the most compelling trends in the defined contribution industry today is the increased use of multiple employer plans. Historically, the greatest number of workers without retirement plan coverage are those who work for small businesses. Retirement plan management for these companies is an administratively burdensome prospect. Lack of in-house benefits expertise, coupled with the fiduciary and legal issues surrounding a complex regulatory environment often make it difficult for small employers to sponsor a plan. Yet lack of benefits are often cited as a reason for high turnover among small businesses, with employees leaving these jobs for positions with organizations that offer more comprehensive benefits packages. Multiple employer plans offer an ideal solution to these challenges and address the complexities these businesses face in offering a retirement plan.
MEPs are not a new concept—these plans have been in existence for many years. What has changed, and why is there renewed interest in these programs? Today, fewer employers sponsor defined benefit pension plans. With small businesses expected to generate the greatest percentage of job growth in the future, the need for retirement plan coverage for employees of these businesses takes on even greater urgency.
Trends in the Defined Contribution Industry - Multiple Employer Plans (Click on link to view on SlideShare for download).
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