The U.S. Department of Labor issued a new rule Monday to make it easier for small businesses to join together through associations to offer retirement savings plans to employees.

President Donald Trump signed an executive order last year ordering the Labor Department to draft a rule easing restrictions on association retirement plans, or ARPs, and multiple-employer plans already in use by some groups. Employers in the same industry or line of business already were able to participate in such plans, but the new rule allows ARPs to be offered by associations of employers related only through geography—such as a state or city—or in a particular industry nationwide, according to an analysis by the National Association of Plan Advisors. http://bit.ly/2Kbnyix

The rule also allows sole proprietors to participate in ARPs and specifies the plans can be run through professional employer organizations, which are human-resource companies that provide certain employment responsibilities for client employers.

The Labor Department noted that roughly 38 million private-sector employees do not have access to retirement saving plans through their employers. The Trump administration's logic behind the rule is similar to a separate, more controversial push by the White House to ease restrictions on association health plans: By allowing small businesses and individuals to join together through associations, the overall cost of providing employee coverage is lowered.

"Many small businesses would like to offer retirement benefits to their employees, but are discouraged by the cost and complexity of running their own plans," Acting Secretary of Labor Patrick Pizzella said. "Association Retirement Plans offer valuable retirement security to small businesses' employees through their retirement years."

The new rule takes effect Sept. 30.