Government Affairs Update

July 17, 2021


Senate Aging Committee Examines Savings and Accessing Other Workplace Benefits

On June 15, the Senate’s Special Committee on Aging held a hearing entitled “Building Wealth and Fostering Independence: Creating Opportunities to Save.” In his opening remarks, Committee Chairman Bob Casey (D-PA) noted that the hearing was convened to “focus on the challenges individuals face when working to achieve long-term financial security and save for a stable retirement.” The Chairman went on to note that while all Americans have concerns about their financial futures, these concerns are deeper for individuals with disabilities and communities of color, where “higher levels of poverty and unemployment have made it more difficult to save long-term.” Chairman Casey highlighted his efforts to improve the ABLE Act, which enables individuals with disabilities to save for retirement without losing their federal benefits.

Ranking Member Tim Scott (R-SC) used his opening statement to address access to workplace retirement savings for employees of small businesses. The Senator noted that in South Carolina, roughly “400,000 full-time workers and 200,000 part-time workers” do not have access to retirement savings at work and that “African American disproportionality have less access than other folks” and “employers are a critical piece of this retirement puzzle.” The Senator went on to say that the SECURE Act “makes it easier for small business owners to set up retirement plans that are less expensive and easier to administer.” Sen. Scott highlighted John Iacofano, a small business owner from South Carolina and witness before the Committee, who utilized a Pooled Employer Plan to provide retirement savings to his employees. In his written testimony, Mr. Iacofano stated, “These cost and administrative savings are the sole reason we are now able to offer our employees retirement benefits. Plus, these low costs allow us to offer a competitive match. These are new dollars going into the paychecks of our valuable team members.”

IRI will continue to monitor Congress for actions related to retirement security.

Any questions should be referred to John Jennings.



Walsh Appears Before Senate Appropriations

Secretary of the Department of Labor (DOL) Martin Walsh appeared before the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies on July 14 to outline the Biden Administration’s budget requests for Fiscal Year 2022 (FY2022). In his opening statement, Sec. Walsh noted that the FY2022 budget request includes $2.1 billion in additional funding to conduct “enforcement and regulatory work needed to ensure workers’ wages, benefits, and rights are protected, address the misclassification of workers as independent contractors, and improve workplace safety and health. These are the staff who recover back wages owed, help prevent fatalities and life-altering injuries or illnesses, respond to whistleblower complaints, reduce exposure to cancer-causing agents, help ensure retirees get their benefits, and address pay inequities.” The budget request also includes a call for an additional $31 million for the Employee Benefits Security Administration (EBSA) to combat staff reductions. 

In her opening statement, Subcommittee Chairwoman Patty Murray (D-WA) highlighted that the President’s budget is a “reflection of values” and the FY2022 budget includes the funding needed to “make sure workers have paid family sick and medical leave, quality affordable childcare, a livable minimum wage of $15 an hour without exceptions, and a secure retirement.” Subcommittee Ranking Member Roy Blunt (R-MO) focused much his opening statement on unemployment, but he did voice his support for programs included in the budget that support hard-hit areas of the country as well as for “veterans transitioning to the civilian workforce” – which Sen. Blunt notes is “one of the key priorities” of the committee and Congress.

Last week, the House Appropriations Committee approved its version of the FY2022 Labor, Health and Human Services, Education, and Related Agencies legislation. The House bill includes $218,475,000 for EBSA – a nearly $38 million increase from FY2021 funding.

IRI will continue to monitor the Department of Labor’s funding for its potential impact on the insured retirement industry during the FY2022 appropriations process.

Any questions should be referred to John Jennings.


DOL Deputy Secretary of Labor and Solicitor Confirmed by Senate

Last week, the Senate voted to confirm two Biden appointees to posts at the DOL. Julie Su was confirmed as the Department’s Deputy Secretary by a vote of 50-47. Prior to her confirmation, Su served as California’s Secretary of Labor and Workforce Development and previously served as California’s Labor Commissioner. The Senate also confirmed the appointment of Seema Nanda to serve as the Solicitor of Labor by a vote of 53-46. Nanda previously serves in roles at the DOL during the Obama Administration and was most recently the CEO of the Democratic National Committee.

IRI will continue to monitor Biden Administration appointments to the DOL and other relevant agencies and commissions.

Any questions should be referred to John Jennings.


Senate HELP to Examine PRO Act on July 22

On Thursday, July 22, the Senate Health, Education, Labor, and Pensions (HELP) Committee will convene for a hearing entitled “The Right to Organize: Empowering American Workers in a 21st Century Economy.” The hearing will focus on the Protecting the Right to Organize (PRO) Act. Among other provisions, the bill redefines “independent contractors” in a manner that would reclassify these individuals as “employees.” This change would have a significant impact on the independent advisors and their clients.

IRI is participating with a financial services trade coalition sharing industry concerns about the bill. Efforts by this coalition have included a letter sent to congressional leaders noting that the “PRO Act’s ‘ABC test’ could eliminate the choice a majority of practitioners have made to serve clients independently. In turn that could drastically reduce clients’ ability to access high-quality advice for their insurance, investment and retirement security needs.” The letter also noted that the concerns surrounding cash compensation and unreported income associated with “independent contractors” in other industries do not exist given the strict regulatory regime place on securities and financial professionals. As such, the letter asks for the legislation to be amended to prevent the “negative impact that this legislation will have on customers, agents, and advisors working to ensure that their clients have the resources to make wise financial decisions and ensure financial security for themselves and their families.”

The House of Representatives passed its version of the PRO Act in March by a vote of 225-206. IRI will continue to monitor for action on the PRO Act.

Any questions should be referred to John Jennings.


Schumer, Booker, & Brown Seek Input on Bill to End Prohibition on Marijuana

Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Committee Chair Ron Wyden (D-OR) and Senator Cory Booker (D-NJ)  released draft legislation last week that would end the federal prohibition on cannabis. The Cannabis Administration and Opportunity Act seeks to remove cannabis from the controlled substances list and enable the states to create their own cannabis laws. If enacted, the bill would also ensure “state-compliant cannabis businesses will finally be treated like other businesses and allowed access to essential financial services, like bank accounts and loans.” In a statement announcing the draft, Majority Leader Schumer said, “The War on Drugs has too often been a war on people, and particularly people of color. Not only will this legislation remove cannabis from the federal list of controlled substances, but it will also help fix our criminal justice system, ensure restorative justice, protect public health, and implement responsible taxes and regulations.”

Earlier this year, IRI submitted a letter of support to the sponsors of H.R. 1996, the Secure and Fair Enforcement (SAFE) Banking Act of 2021.  This bill would provide protection and insulation from liability for both participants and institutions offering and administering retirement plans or individual retirement accounts for the employees of cannabis companies and associated businesses regulated and licensed by a state. Additionally, IRI’s 2021 Federal Retirement Security Blueprint included a call for the enactment of legislation which would provide “adequate certainty and clarity to facilitate and encourage the offering of retirement plans and individual retirement accounts for workers at cannabis companies that legally operate in their state.” IRI will continue to monitor for actions to enable the legal cannabis industry to access retirement products and services.

Any questions should be referred to John Jennings.



Maryland Releases Proposed Best Interest Regulation

The Maryland Insurance Administration released its proposed best interest regulation and is seeking comments on the draft through August 9, 2021. The proposed regulation closely tracks the NAIC Suitability in Annuity Transactions Model Regulation, and deviations are mainly non-substantive in nature, with a couple of items of note:

  •  The Scope language does not follow the NAIC Model.
  • The Compliance and Penalties section, unlike the NAIC Model, does not state that penalties may be reduced or eliminated if corrective action for the consumer was taken promptly after a violation was discovered and not part of a pattern or practice. It also does not state that authority to enforce compliance is vested exclusively with the commissioner.


No effective date was proposed, but IRI would seek an implementation date of six months after enactment. IRI will begin to develop responsive comments to the proposed regulation.

Any questions should be referred to Sarah Wood.


DOL, Other Federal Departments Issue Business Advisory for Xinjiang, China

On July 13, the DOL, in collaboration with the U.S. Department of State, the U.S. Department of the Treasury, the U.S. Department of Commerce, the U.S. Department of Homeland Security, and the Office of the U.S. Trade Representative, issued an updated Xinjiang Supply Chain Business Advisory. The updated advisory alerts businesses to the heightened risks of supply chain and investment links to entities “…complicit in state-sponsored forced labor and other human rights abuses in Xinjiang and throughout China as part of labor transfer programs”.

Per the DOL’s press release, “The updated advisory stresses that businesses and individuals doing business in Xinjiang do not currently have the capacity to engage in adequate due diligence, given the limitations imposed by the Chinese government. Therefore, those that do not exit supply chains, ventures and/or investments connected to Xinjiang run a high risk of violating U.S. law”.

IRI shared this updated Business Advisory regarding securities and investments related to the Xinjiang corporation with our Securities Committee and will share with our Advocacy Steering Committee to best determine members’ concerns and/or reactions to this multi-Federal agency investment prohibition.

Any questions should be referred to Emily Micale.