On May 8, 2026, Assistant Secretary of Labor Daniel Aronowitz delivered remarks at The ESOP Association’s National Conference in Washington, DC.  He began by discussing “three key goals” of the Employee Benefits Security Administration (“EBSA”) in addressing the regulatory overreach and litigation abuse targeting the American retirement system:

1. EBSA will promote regulatory clarity that restores discretion to plan sponsors and deference to their reasonable judgments;
2. EBSA will deemphasize enforcement actions in favor of compliance assistance and outreach efforts, reserving enforcement for bad actors who breach their duty of loyalty; and
3. EBSA will combat private party ERISA litigation abuse that has inhibited creativity and innovation in the retirement space.

In practice, this means an emphasis on process and fair notice, rather than open-ended investigations, second-guessing fiduciary decisions with the benefit of hindsight, and relying on novel legal theories or interpretations of ERISA during enforcement actions.  Aronowitz elaborated that “all enforcement activity will have a close nexus to the plain language of ERISA’s text, unambiguously clear instructions provided in Department regulations or prominently published sub-regulatory guidance, or clearly established caselaw.”

As an example, he pointed to the lack of a regulation interpreting “adequate consideration” (the exemption governing ESOP stock purchase transactions).  Until EBSA proposes such a rule, Aronowitz said that “all pending and proposed ESOP valuation enforcement actions will be reviewed against these guiding principles,” and that many pending investigations have been closed as a result.  In addition, EBSA has removed ESOPs from its national enforcement projects list.

Aronowitz also highlighted the Department of Labor’s efforts to tackle litigation abuse by private parties.  These efforts include the Department’s amicus brief program, through which the Department has recently expressed its views on a number of hot-topic ERISA issues in high-profile cases.  The goal, according to Aronowitz, is to “affirm that ERISA is a law of process, in which plan fiduciaries have discretion and flexibility to make responsible judgment calls.”  When those “decisions are challenged, they are entitled to deference” and “should be judged by process, not in hindsight by results.”

In closing, Aronowitz discussed the Department’s employee ownership initiatives, including the development of a website with information on ESOPs and other forms of employee ownership, and a new grant program to support state employee ownership programs.

EBSA's goals as described by Aronowitz are consistent with potential Congressional action that would curtail the litigation risks and eliminate the regulatory burdens that have hindered plan sponsors and fiduciaries. Proposed legislation, for example, would end the Department of Labor's practice of entering into common interest agreements with plaintiffs’ law firms; require investigations to conclude within a reasonable timeframe; and reverse plaintiff-friendly Supreme Court precedent for ERISA prohibited transaction claims, including claims that an ESOP overpaid for employer stock.