Daniel Aronowitz testified Thursday at a Senate Health, Education, Labor and Pensions Committee confirmation hearing. Credit: Senate HELP
Labor attorney Daniel Aronowitz, President Trump's nominee to be the assistant secretary of Labor in charge for the Employee Benefits Security Administration (EBSA), stated that he would “expand retirement benefits and ownership to America’s workers,” as he spoke at his confirmation hearing before the Senate Health, Education, Labor and Pensions Committee last week.
When questioned by Senator John Hickenlooper (D-DO) about the “more than 5.4 million workers” including gig economy and small business workers, who don't have access to employer-sponsored retirement plans, Aronowitz said he would commit to working to help Congress pass the Retirement Savings for Americans Act.
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The RSAA legislation, which was reintroduced by Senators Hickenlooper and Thom Tillis (R-NC) after being reintroduced in the House in April, would help private sectors workers without access to 401(k)s build wealth and save for retirement.
Modeled after the Thrift Savings Plan for federal employees, the RSAA would automatically enroll private workers without access to a workplace retirement plan. The RSAA, which would offer a federally-run program for uncovered low- and middle-income workers,
Aronowitz, a labor law blogger was the president of Encore, a company that sells fiduciary liability insurance and other forms of liability insurance to employee benefit plans until recently. Earlier in his career, he was president of the union-owned Ullico Casualty Company, then founded Euclid Fiduciary in 2011, now called Encore.
In his opening statement, Aronowitz said he had three goals, if given the opportunity to lead EBSA:
“First, I will improve EBSA’s enforcement of fiduciary law. He will “end the bias against [employee stock ownership plans] ESOPs and other legitimate ways to expand retirement benefits and ownership to America’s workers,” he said.
“Second, I will strive to provide regulatory clarity so that plan sponsors have the proper incentive to expand employee benefits,” including “modernizing defined contributions plans to include alternative investments, such as private equity and cryptocurrency,” the “consideration of ESG-factors ... the fiduciary rule as applied to IRA rollovers,” and plan forfeitures and pension risk transfers.
“We will end the era of regulation by litigation by providing clear and effective rules for America’s employee benefit system.We will restore discretion to plan fiduciaries as Congress intended in the ERISA statute, so that fiduciaries, not the government or plaintiff lawyers, decide what is best for plan participants.”
“Third, I will champion the cause of encouraging plan sponsors … to expand retirement and health care benefits to America’s workers.I will champion expanding retirement and health plan access to America’s independent contractor workforce.”
When asked specifically about ESOPs, Aronowitz responded, "Everybody is for ESOPs except for the DOL for the last 20 years. I will end the war on ESOPs. I think it's the best way for employees to get an additional benefit and ownership in an American company."
Related: Benefits agency nominee faces Senate hearing, backs association health plans
If Aronowitz is confirmed by the committee and the full Senate as the administrator of EBSA, he will be in charge of developing and implementing regulations affecting employer-sponsored health plans and employer-sponsored retirement plans.
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Lynn Cavanaugh
Lynn Varacalli Cavanaugh is Senior Editor, Retirement at BenefitsPRO. Prior, she was editor-in-chief of the What's New in Benefits & Compensation newsletter. She has worked for major firms in the employee benefits space, Vanguard and Willis Towers Watson, as well as top media companies, including Condé Nast and American Media.
