Courts Press Pause on Department of Labor Fiduciary Rule 

The Department of Labor’s (DOL) widely panned Fiduciary Rule is on hold and will not begin implementation in late September as the DOL had intended. The hold comes in response to rulings on two legal challenges which sought vacatur of the rule package and a stay in rule implementation while litigation is pending.  

The arguments with which the District Courts agreed were similar to those made IPA’s January comment letter. Both courts affirmed that ERISA recognizes a distinction between sales and advice and that commissions generally aren't fees for advice.

While the DOL is likely to appeal and may ask the Fifth Circuit or, ultimately, the Supreme Court to uphold these rules, in the short term, the Fiduciary Rule appears to be on very shaky ground. It is highly likely that the DOL will engage in additional related rulemaking after the litigation ends should Democrats maintain control of the White House.  

IPA has a long history of advocacy on this issue and stands ready to re-engage with the Department. We also continue to monitor the courts as the challenges advance.