ERISA at 45: ESOPs

In our fourth installment of ERISA at 45, Sarah Bassler Millar interviews Jeremy Pelphrey regarding the DOL’s focus on the fiduciary process in ESOP transactions and administration, current trends in ESOP transactions, and the positive implications of ESOPs for employee-owners.

Among the topics referenced are the role of the Department of Labor’s process agreements for fiduciaries, which have also led to comfort in transactions and lending; the uptick in 100 percent transactions due in part to heightened interest in private equity lending; and the push by Congress to expand employee ownership. Data shows the positive impact of ESOPs in the marketplace, as ESOP companies are 25 percent more likely to stay in business, and ESOP employees’ wages are 8-12% higher and retirement account balances are greater, in comparison to their non-ESOP company and employee counterparts.

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