The Labor Department released a final rule to make it easier for small businesses to band together to create joint 401(k) retirement plans for workers.
The rule, which takes effect Sept. 30, broadens the ways companies could join together to offer retirement accounts, according to a department official.
Under the rule released Monday, companies in different industries—for example, landscaping companies and real-estate firms—could create a joint plan as long as they are located in the same state or metropolitan area. The rule also would clarify that similar companies—for example two landscaping companies—located in different regions of the country could join together.
Such arrangements, often called multiple-employer plans, are currently limited to employers with an affiliation or connection, such as a common owner or being members of an industry trade group. The rule means local chambers of commerce are more likely to sponsor retirement plans for companies affiliated with them.
The regulation, though, is geographically limiting for companies in different industries. For instance, a Baltimore landscaping company wouldn’t be able to join with a Seattle real-estate firm to offer a plan.
The regulatory action marks the first final rule the Labor Department has made since Patrick Pizzella stepped in as acting secretary following the recent departure of Alexander Acosta.
Mr. Acosta left his position after coming under criticism for his role, while a federal prosecutor in 2007, in negotiating a plea agreement for Jeffrey Epstein, a financier arrested on charges of sex trafficking.
President Trump announced he plans to nominate corporate attorney Eugene Scalia to succeed Mr. Acosta.
Meanwhile, business groups expect Mr. Pizzella to move quickly on unfinished policy proposals, such as a new overtime rule and a regulation that would clarify when a worker could be jointly employed by two companies.
The Trump administration has touted the retirement-plan rule’s potential to help more small-business employees gain access to benefits. Research shows workers at small companies are less likely to have access to retirement savings plans than those at larger companies.
Under the retirement-plan rule, smaller companies would be able to use the larger scale of the combined businesses to bargain for lower administrative and investment fees than they might otherwise get.