Senators and representatives introduce CRA resolution to stop implementation of DOL’s final ‘fiduciary rule’

Led by Senator Johnny Isakson (R-GA), dozens of Republican senators introduced a resolution (S.J. Res. 33) on April 18, 2016 to stop the implementation of the Department of Labor’s (DOL’s) final rule addressing conflicts of interest in retirement advice and defining the term “fiduciary” for ERISA purposes. Isakson, Lamar Alexander (R-TN) and Mike Enzi (R-WY) filed the resolution of disapproval under the Congressional Review Act (CRA) to reject what they call the Administration’s “Retirement Advice Gag Rule.” In addition, on April 19, 2016, Rep. Phil Roe (R-TN), chairman of the Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions, along with Rep. Charles Boustany, chairman of the Ways and Means Subcommittee on Tax Policy, and Rep. Ann Wagner (R-MO), introduced a resolution (H.J. Res. 88), under the Congressional Review Act, to block the Department of Labor’s allegedly controversial rule restricting access to investment advice. The House resolution was approved on April 21, 2016 by the House Education and the Workforce Committee, chaired by Rep. John Kline (R-MN).

The Senators assert that the regulation will have devastating effects on retirement planning by hardworking families and small businesses because, though the rule was allegedly designed to protect individuals from misleading investment advice, in practice, “the new rule will make retirement planning unaffordable for low- to middle-income Americans whose accounts are not valuable enough for advisors to take on the new legal liability created by the rule.” Rep. Roe echoes the Senators’ assertions, saying, “[t]his new regulatory scheme will hinder access to retirement advice for low- and middle-income families and make it harder for small businesses to help their employees plan for retirement.”

If approved, the resolution of disapproval would allow Congress to stop the DOL from implementing the rule. Under the CRA, the House and Senate may vote on a joint resolution of disapproval to stop, with the full force of law, a federal agency from implementing a rule or regulation or issuing a substantially similar regulation without congressional authorization. A resolution of disapproval only needs a simple majority to pass and cannot be filibustered or amended if acted upon a 60-day window. The resolution of disapproval must also be signed by the President (it faces an almost certain veto), or Congress can overturn a veto with a two-thirds vote in both the Senate and the House.

“I have worked to fight the implementation of this harmful rule since it was first proposed,” said Isakson, who is chairman of the Senate Health, Education, Labor and Pensions Subcommittee on Employment and Workplace Safety. “Like so many of this administration’s decisions, their new fiduciary rule harms the very individuals it seeks to protect and prevents those hardworking Americans who are trying to plan for retirement from having the opportunity to access retirement advice.”

Source: S.J. Res. 33; H.J. Res. 88.

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