1 See Institute Memorandum to Pension Committee No. 56-98 and Pension Operations Advisory Committee No. 41-98,
dated August 28, 1998.
[10581]
December 18, 1998
TO: PENSION COMMITTEE No. 89-98
PENSION OPERATIONS ADVISORY COMMITTEE No. 72-98
RE: DEPARTMENT OF LABOR RELEASES MEMORANDUM ON Y2K ISSUES
______________________________________________________________________________
The Department of Labor has recently released a memorandum that restates the general
guidance issued to the Pension and Welfare Benefits Administration’s Regional and District Offices to
assist investigators in evaluating the potential fiduciary liability arising from the effect of the Y2K
computer issue on the operation of employee benefit plans. This summer, the Department released two
press releases and informal guidance in the form of questions and answers relating to fiduciary
responsibilities concerning the Y2K issue.1 This memorandum includes sample questions distributed to
the Regional and District Offices to assist field office staff in conducting Y2K reviews.
The memorandum states that in evaluating whether a plan fiduciary has implemented a prudent
procedure to protect the plan’s interests with regard to Y2K compliance, the fiduciary should evaluate
the following: (1) the plan’s own computer system; (2) the plan sponsor’s computer system; (3) the plan
service provider’s computer system; and (4) the computer systems relating to the plan’s investments. In
addition, the plan fiduciary should establish and implement a contingency plan designed to protect the
interests of the plan and its participants and beneficiaries in the event a Y2K problem arises. The
attachment to the memorandum contains sample fiduciary questions sent to Department investigators
regarding the Y2K issue. The categories of questions are as follows: (1) plan’s internal computer
operations; (2) external computer operations of plan service providers; (3) plan sponsor’s computer
system; (4) investigations focused on financial institutions; and (5) investment-related issues.
A copy of the memorandum is attached.
Kathryn A. Ricard
Assistant Counsel
Attachment