House and Senate Members Look to Block DOL Fiduciary Rule

Yesterday, three members of the House of Representatives introduced a resolution under the Congressional Review Act to block the Department of Labor’s recently released fiduciary rule. A similar resolution was introduced by three Republican senators on Monday. The legislative maneuvers are viewed as largely ceremonial, as President Obama, the main driving force behind the DOL rule, would certainly veto them should they make their way to the Oval Office.

On Tuesday, a resolution was introduced by Rep. Phil Roe (R-TN), chairman of the Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions, Rep. Charles Boustany (R-LA), chairman of the Ways and Means Subcommittee on Tax Policy, and Rep. Ann Wagner (R-MO), all outspoken opponents to the new fiduciary standard pertaining to investment advice.

“In today’s economy, too many families are struggling to save for retirement. That’s why it’s crucial Americans have access to the retirement advice they need to make the best decisions for the future,” Rep. Roe said. “Unfortunately, the administration’s misguided rule does just the opposite. This 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.”

Under the Congressional Review Act, Congress may pass a resolution of disapproval to prevent a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization. The resolution would block the Department of Labor’s fiduciary rule, which is scheduled to go into effect in April 2017.

The resolution follows earlier efforts by House lawmakers to enact an alternative to the DOL rule.

Last October, Wagner introduced H.R. 1090, dubbed the Retail Investor Protection Act of 2015, in an attempt to prohibit the DOL from moving forward until the SEC issued its own version. The bill passed mostly along party lines in a 246-184 vote.

Rep. Roe introduced the Affordable Retirement Advice Protection (ARAP) Act, and Rep. Peter Roskam (R-IL) led the Strengthening Access to Valuable Education and Retirement Support (SAVERS) Act to replace rule. The bills passed two House committees along party lines.

A markup in the Education and Workforce Committee is scheduled for Thursday.

Similarly, on Monday, Senators Johnny Isakson (R-GA), Lamar Alexander (R-TN), and Mike Enzi (R-WY), also introduced a resolution of disapproval to reject what they call the administration’s new “retirement advice gag rule.”

Isakson is the lead sponsor of the resolution, which, in addition to Alexander and Enzi, is being co-sponsored by 30 additional Republican senators.

“The introduction of this resolution is the next step in the battle,” 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.”

A resolution of disapproval only needs a simple majority to pass and cannot be filibustered or amended, if acted upon a 60-day window. It must also be signed by the President, or Congress can overturn a veto with a two-thirds vote in both the Senate and the House.