COVID-19 Employer Playbook

11. Formal SMM Distribution What

Formal notification of the material modifications to plans must be prepared and distributed to plan participants. This includes the following elements:

• Free COVID-19 testing • Free COVID-19 treatment* • HDHP free telehealth services* • Waive 10% early withdrawal penalty* • Increase maximum loan amount* • Required Minimum Distribution removed for 2020

*If adopted

This is an ERISA requirement.


SMMs must be provided within 60 days of the material modification (May 30, 2020). This is the technical standard, however, a "common sense" deadline has emerged as standard practice when merely furnishing information about plan changes within the statutory guidelines clearly would be insufficient or detrimental based on common sense. Given this, formal SMMs should be distributed as soon as administratively possible. For those employers using a wrap-around SPD, the updated language in the certificate of coverage or a plan amendment document from the carrier will be required.



12. Retirement Plan Administration Issues What

Coordinate retirement plan provisions with plan recordkeeper to confirm the necessary steps to enable and administer:

• Hardship withdrawals on account of a major disaster • COVID-19 distributions • Loan relief for participants

Some employees will want to take advantage of these new safety net features of their retirement plans. Employers will want to make sure that administrators are ready and able to process requests.




Retirement plan administrators are scurrying to define procedures and put processes in place to accommodate these provisions. Proactive employers will want to confirm the details with their recordkeeper.



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