Headlines about "Multiemployer plans"
Gathered from the web by the editors at BenefitsLink.com.
Goldman Sachs Faces Union Pension Plan Lawsuit Over Executive Pay
Excerpt: "International Brotherhood of Electrical Workers Local 98 Pension Fund in Philadelphia filed suit against Goldman Sachs Group, accusing it of overpaying its executives while underpaying its shareholders and damaging its stock price." (Workforce Management; free registration required)
[Guidance Overview] Final Rule Issued on Participant-Requested Multiemployer Plan Documents (PDF)
3 pages. Excerpt: "This Multiemployer Alert details the Department of Labor's final rule on the statutory requirement that multiemployer retirement plan administrators must provide copies of actuarial and financial documents after receiving a request from plan participants and others. There is also information on DOL's final rule on civil penalties for certain multiemployer plan funding failure." (Milliman)
[Guidance Overview] Final Regulations Issued on PPA Disclosure Requirements for Multiemployer Plans
Excerpt: "The Employee Benefits Security Administration (EBSA) has issued final regulations on the obligation of multiemployer plan administrators to disclose certain actuarial and financial information to participants and others. The proposed rules reflect the disclosure requirements mandated by the Pension Protection Act of 2006 (PPA; P.L 109-280), embodied in ERISA ?101(k). The final regulations are substantially the same as proposed rules issued in 2007." (Wolters Kluwer)
[Guidance Overview] Milliman's March 2010 Multiemployer Plan Alert (PDF)
Includes overview of final DOL regulation on participant-requested documents and DOL final regulation on civil penalties for certain funding failures. (Milliman)
[Official Guidance] IRS Notice 2010-24: Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates (PDF)
4 pages. Notice 2010-24 provides guidance as to the corporate bond weighted average interest rate and the permissible range of interest rates specified under sec. 412(b)(5)(B)(ii)(II) of the Internal Revenue Code. It also provides guidance on the corporate bond monthly yield curve (and the corresponding spot segment rates), the 24-month average segment rates, and the funding transitional segment rates under sec. 430(h)(2). In addition, it provides guidance as to the interest rate on 30-year Treasury securities under sec. 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008, and the minimum present value segment rates under sec. 417(e)(3)(D) as in effect for plan years beginning after 2007." (Internal Revenue Service)
[Official Guidance] Federal Register Version of DOL Final Reg on Multiemployer Pension Plan Information Made Available on Request (PDF)
10 pages. The final regulation is effective on April 1, 2010. Excerpt: "Section 101(k) of [ERISA] added by section 502(a)(1) of the Pension Protection Act of 2006 (PPA), provides that the administrator of a multiemployer pension plan, upon written request, shall furnish copies of certain actuarial and financial documents to any plan participant, beneficiary, employee representative, or any employer that has an obligation to contribute to the plan." (U.S. Employee Benefits Security Administration)
[Official Guidance] Text of Final DOL Regs Improving Access to Multiemployer Retirement Plan Information (PDF)
34 pages; scheduled for publication in the Federal Register on March 3. Excerpt: "This document contains a final rule implementing section 101(k) of [ERISA], as amended by the Pension Protection Act of 2006. Section 101(k) requires the administrator of a multiemployer plan to provide copies of certain actuarial and financial documents about the plan to participants, beneficiaries, employee representatives and contributing employers upon request. . . . This final rule is effective on [INSERT DATE THAT IS 30 DAYS FOLLOWING DATE OF PUBLICATION IN THE FEDERAL REGISTER]." (U.S. Employee Benefits Security Administration)
[Official Guidance] Fact Sheet on Final DOL Regs Improving Access to Multiemployer Retirement Plan Information
Proposed regs were issued September 14, 2007. Excerpt: "The regulation requires the administrator of a multiemployer pension plan, on the written request of any plan participant, beneficiary, employee representative (e.g., union), or any employer that has an obligation to contribute to the plan, to furnish copies of requested financial and actuarial reports of the plan. The documents that are required to be furnished are: * Periodic actuarial reports.* Quarterly, semi-annual, or annual financial reports. *Certain applications filed with the Secretary of the Treasury and related determinations (amortization extensions)." (U.S. Employee Benefits Security Administration)
[Official Guidance] Text of Final DOL Regs on Civil Penalties under ERISA Section 502(c)(8); Multiemployer Plans Affected (PDF)
9 pages. Excerpt: "Under [ERISA section 502(c)(8)], which was added by the Pension Protection Act of 2006, the Secretary of Labor is granted authority to assess civil penalties not to exceed $1,100 per day against any plan sponsor of a multiemployer plan for certain violations of section 305 of ERISA. The regulation will affect multiemployer plans that are in either endangered or critical status. . . . This final rule is effective on March 29, 2010." (U.S. Employee Benefits Security Administration)
Ex-Benefits Administrator Charged in $40M Embezzlement Case
Excerpt: "The former administrator of a New York union benefits fund was indicted for embezzling $40 million to support a lavish lifestyle. Prosecutors in the case allege that the spending included $5 million for horses, $300,000 for women's clothes at Neiman Marcus and about $1 million for jewelry." (PLANSPONSOR.com)
PBGC Aids Insolvent Multiemployer Pension Plans
Excerpt: "The insurance program for multiemployer plans differs from its single-employer program. The PBGC actually takes over failed single-employer plans but does not take over insolvent multiemployer plans. Instead, it sends financial assistance to the plan to ensure that guaranteed benefits are paid." (Workforce Management; free registration required)
Genetic Testing: An Ever-Evolving Health Field Raises Complex Coverage Issues (PDF)
4 pages. Excerpt: "Since the 1990s, there has been explosive growth in both the number of genetic tests and the costs associated with them. As part of their constant efforts to manage their health plan costs, trustees of multiemployer health funds need to be aware of these developments so they can periodically revisit their plans' coverage for genetic testing to ensure that it has medical value. This NewsLetter presents an overview of the issues and options." (The Segal Group, Inc.)
Market Troubles Hit Multiemployer Plans Hard
Excerpt: "A new Segal Company report shows a deterioration in the funding status of more than 360 multiemployer client plans between 2008 and 2009 due to the meltdown in the investment markets." (PLANSPONSOR.com)
Senate Bill Takes Aim at Small Employer Insurance Groups
Excerpt: "Congress is taking aim at MEWAs, or Multiple Employer Welfare Arrangements, which are cooperative-like entities in which health and other benefits are marketed to groups of small employers." (HCPro, Inc.)
Results from Segal's Survey of Multiemployer Plans' 2009 Zone Status: Winter 2010 Report
Excerpt: "The Segal Company's Survey of Plans' 2009 Zone Status reports the percentage of multiemployer pension plans that fell into each of the three zones - red ('critical status'), yellow ('endangered status') and green (neither critical nor endangered) - in 2009." (The Segal Group, Inc.)
[Guidance Overview] 2009 Form M-1 Now Available; Virtually Unchanged from 2008
Excerpt: "EBIA Comment: We expect that the 2010 Form M-1 will request information about a MEWA's or ECE's compliance with the recently enacted mandates and that the DOL will also update the self-compliance checklists for these mandates. Substantial penalties apply for failing to comply with the Form M-1 reporting requirements. Thus, filings should be completed on a timely basis." (Employee Benefits Institute of America)
'Withdrawal Liability' in a Multiemployer Pension Plan (PDF)
Pages 2-3 of 8 pages. Excerpt: "A multiemployer plan with assets that are lower than its liabilities has one of these creatures, but unless and until a contributing employer withdraws (hence the name) from the plan, it's an interesting but easy-to-ignore figure." (American Academy of Actuaries)
[Guidance Overview] Union May Indemnify Employer for Withdrawal Liability Owed to Multiemployer Plan
Excerpt: "A union may use a collective bargaining agreement to indemnify an employer for the withdrawal liability owed by the employer to a multiemployer plan, the U.S. Court of Appeals in Philadelphia (CA-3) has ruled in Pittsburgh Mack Sales & Service, Inc. v. International Union of Operating Engineers, Local Union No. 66." (Wolters Kluwer)
Women Reshape Union Agenda
Excerpt: "Women make up nearly half of the union membership and that is having an impact on issues that come up at the bargaining table. There's more of an emphasis on work/life issues, paid sick leave and paternity leave, experts say." (Human Resource Executive Online)
[Guidance Overview] Beyond Compliance with Mental Health Parity and Addiction Equity Act of 2008: An Opportunity to Integrate Behavioral Health and Medical Coverage
Excerpt: "Sponsors of group health plans have the opportunity to reexamine their current behavioral health coverage as they prepare to comply with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). If trustees of multiemployer health funds start soon, they will have sufficient time to conduct a thorough and thoughtful plan review and craft strategies for better management of the coverage for mental health and addiction conditions. These strategies can help keep cost increases under control, while maintaining, and even enhancing, critical benefits." (The Segal Group, Inc.)
Retiree Medical Benefit Reductions Limited under House Version of Proposed Healthcare Reform
Excerpt: "Section 110 of the House Bill amends [ERISA] to require all group health plans, including union plans, to add a provision that expressly bars post-retirement reductions in the benefits provided to retirees or their beneficiaries unless the reduction is also made with respect to active participants. This prohibition would override any plan provision that reserves the right to amend or terminate the plan or specifically authorizes the plan to make post-retirement reductions in retiree medical benefits." (Michael Best & Friedrich)
Administrator Charged with Embezzling Tens of Millions from Union Benefit Plans
Excerpt: "[T]he announcement said, between 2002 and 2008, King caused at least $42.6 million to be transferred, in the form of checks, from the bank accounts of the Local 147 Funds into a bank account controlled by King Care, including the following approximate amounts per year . . . ." (PLANSPONSOR)
[Opinion] Union Pension Bailout Bill Would Burden Employers and Taxpayers
Excerpt: "[Labor union] leaders habitually put high principle aside when their own hides need bailing out. Case in point: a bill introduced in late October by Rep. Earl Pomeroy, D-N.D. (see photo), the Preserve Benefits and Jobs Act of 2009 (H.R. 3936). This legislation would enlist taxpayers to support troubled union-sponsored multiemployer pension plans and impose major burdens upon employers. Ultimately, the general public will pay the tab. It's another example of how interest-group politics benefits the relative few at the expense of the great many." (National Legal and Policy Center)
[Guidance Overview] Bill to Ease Multiemployer Pension Funding Is Introduced in Congress (PDF)
2 pages. Summarizes the multiemployer features of newly proposed pension funding relief legislation: the Preserve Benefits and Jobs Act of 2009 (PB&J Act), which was introduced by Congressmen Pomeroy and Tiberi. (Segal Company)
[Opinion] Bill to Ease Multiemployer Pension Funding Is Introduced in Congress (PDF)
2 pages. Excerpt: "Funding relief legislation for multiemployer pension plans was introduced in the U.S. House of Representatives on October 27. H.R. 3936, the Preserve Benefits and Jobs Act (PB&J Act), sponsored by Representatives Earl Pomeroy (D-ND) and Patrick Tiberi (R-OH), includes extensive relief for single employer plans as well. This is a notable starting point, but Congress is still a long way from passing legislation to make it easier for trustees, employers and unions to deal with the impact of the 2008 market losses on pension plan funding." (The Segal Group, Inc.)
[Guidance Overview] IRS Guidance for Approval of Revocation Requests for Multiemployer Plans (PDF)
2 pages. Excerpt: "On September 9, 2009, the IRS issued Revenue Procedure 2009-43. This guidance provides additional conditions for the automatic approval of requests for the revocation of multiemployer elections provided under the Worker, Retiree and Employer Recovery Act (WRERA)." (Prudential Retirement)
[Guidance Overview] IRS Regulations on Pension Funding and Benefit Restrictions (PDF)
2 pages. Excerpt: "The Internal Revenue Service and the Treasury Department recently published final funding regulations for single-employer pension plans, which will generally first take effect for the 2010 plan year. Employers can also rely on these regulations for 2008 and 2009, if they choose. The regulations contain a large amount of technical details. This Bulletin gives a high-level summary of key provisions that might be of interest to private sector employers. It notes highlights of the following: The rules for determining minimum required contributions and The rules for how benefit restrictions are administered." (The Segal Group, Inc.)
.For Delphi Pensioners, the Union Label Helps
Excerpt: "The Pension Benefit Guaranty Corporation, which insures pension plans, caps the amount of benefits it will pay, using a formula based on age and the type of benefits an employee earned. But in a side arrangement, G.M. is agreeing to pay special supplements, called top-ups, so that Delphi's union retirees get everything they were promised. The automaker is drawing the money from its own pension fund, according to a person familiar with the arrangement. In a sense, the G.M. pension fund is being weakened to help the Delphi union members." (The New York Times; free registration required)
[Guidance Overview] For 2010, Only PBGC Single Employer Premium to Increase, No Change in PBGC Guarantee Limit Anticipated (PDF)
2 pages. Excerpt: "For 2010, the per capita flat-rate Pension Benefit Guaranty Corporation (PBGC) premium for single employer plans will increase by one dollar and the per capita flat-rate premium for multiemployer plans will be unchanged. The PBGC has not yet released its monthly maximum guarantee for 2010, but because there was no change in the 'old law Social Security wage base' ($79,200), Segal does not expect the maximum benefit guaranteed by the PBGC under private-sector single employer pension plans that terminate during 2010 to change from the 2009 level." (The Segal Group, Inc.)
[Guidance Overview] Multiemployer Plan Wrongfully Suspended Retiree's Benefits After Misreading ERISA's 'Trade or Craft' Rule
Excerpt: "A multiemployer pension plan violated ERISA when it suspended a retired meat cutter's monthly benefit after he obtained employment as a baked goods independent distributor, the U.S. Court of Appeals in St. Louis (CA-8) has ruled in Eisenrich v. Minneapolis Retail Meat Cutters and Food Handlers Pension Plan. The determination of whether two jobs are included within the same 'trade or craft' under ERISA ?203 must be based on the specific skills actually used by the retiree in the two jobs, and not the general classification of the two jobs." (Wolters Kluwer)
[Guidance Overview] GINA Regulations Require Redesign of Health Plan Wellness and Disease Management Incentives
Excerpt: "The Bulletin provides an overview of GINA's prohibitions; discusses the regulations involved in using health-risk assessments to ask questions about an individual's family medical history; and briefly outlines the action steps for sponsors of group health plans. Plan sponsors must conduct a compliance review immediately to ensure that: Health-risk assessments (including those designed by outside vendors) and any associated wellness policies and procedures comply with GINA's broad prohibition on collecting genetic information; and Wellness or disease management programs do not collect or use genetic information to screen individuals for eligibility for benefits under the plan." (The Segal Group, Inc.)
DOL Rejects Bush Administration LM-2 Union Reporting Changes
Excerpt: "In a generally anticipated move, the U.S. Department of Labor's Office of Labor-Management Standards (OLMS) will publish a rule [today] rescinding the Bush administration's most recent changes to the LM-2 union report filed under the Labor-Management Reporting and Disclosure Act (LMRDA). This development confirms the Obama administration's interest in reducing the administrative burden on unions, and may signal the beginning of a focus shift to certain aspects of employer reporting under the LMRDA. In particular, many believe that OLMS will soon enhance scrutiny on employer and consultant reporting of so-called 'persuader' activity." (Morgan, Lewis & Bockius LLP)
Developments of Interest in the Multiemployer Health Plan Environment (PDF)
1 page. Excerpt: "This report includes: Recent developments in health care and the multiemployer marketplace. Data including consumer price index (CPI) and Segal health trends. A context for what's happening to health plans." (The Segal Group, Inc.)
[Guidance Overview] State Court Next Stop for Union Plan Wrongful Payment Suit
Excerpt: "A Taft-Hartley plan is not permitted to recoup more than $13,000 in wrongly paid health plan claims under the Employee Retirement Income Security Act (ERISA), but may be able to take the dispute into New York state court, a federal judge in New York has ruled. The decision came in a suit by the N.Y. State Teamsters Council Health & Hosp. Fund against Daniel Williams and his ex-wife Nicole Ferren, with allegations that Williams and Ferren submitted $13,287.43 in medical claims for Ferren after the two were divorced and that the plan mistakenly paid them. The suit said Williams never informed the plan of the divorce." (PLANSPONSOR.com; free registration required)
Rebuilding Workers' Retirement Security: A Labor Perspective on Private Pension Reform
Excerpt: "This chapter surveys the issues facing policymakers and workers' organizations thinking about rebuilding a viable retirement security system in the United States, in the context of declining defined benefit coverage and persistent serious flaws in defined contribution plans. The chapter lays out principles for a universal system of supplemental retirement income coverage based on mandatory contribution levels, mandatory portability, limitations on early withdrawals, and annuitization. The structure outlined envisions continued participant and employer choice of both investment strategy and benefit design, with incentives built in for collective asset management." (Pension Research Council; registration required to download fulltext of paper)
The Relationship Between Union Status and Employment-Based Health Benefits (PDF)
Pages 15-21 of 24 pages. Excerpt: "Union workers are much more likely tohave employment-based health benefits than nonunion workers. In September 2007, 82.7 percent of union workers were covered by health benefits through their own job, compared with 58.2 percent of nonunion workers . . . . Overall, 94.2 percent of union workers had employment-based health benefits, compared with 76.4 percent of nonunion workers." (Employee Benefit Research Institute)
[Guidance Overview] Third Circuit Validates Indemnity Agreement in Collective Bargaining Agreement for Payment of Withdrawal Liability (PDF)
Pages 2-3 of 5 pages. Excerpt: "The Third Circuit's decision does not give employers a free pass on withdrawal liability, but it may very well provide employers with an opportunity to significantly reduce theirexposure to this type of liability -- over which they typically have little control -- through the collective bargaining process." (Proskauer Rose LLP)
[Official Guidance] Text of PBGC Approval of Special Withdrawal Liability Rules for Multiemployer Plan for Chicago Apartment Cleaning Businesses (PDF)
3 pages. Excerpt: "Over the past 10 years, cessation of contributions by any individual employer has not had an adverse impact on the Local 1 Plan's contribution base. Most of the employers that have ceased to contribute have been replaced by another employer who begins contributions for the same employees at the same location for the same work. . . . Contributions to the Local 1 Plan are made with respect to Chicago residential buildings. This contribution base is secure and the departure of one employer from the Local 1 Plan is not likely to have an adverse effect on the contribution base so long as the number of buildings covered does not decline." (Pension Benefit Guaranty Corporation)
[Guidance Overview] Boeing Change to Retiree Health Benefits Gets Court Approval
Excerpt: "The U.S. District Court for the Northern District of Illinois has found that Boeing Co. did not violate the Employee Retirement Income Security Act (ERISA) or the Labor Management Relations Act (LMRA) when it presented changes to retirees' health benefits in a 2006 collective bargaining agreement (CBA). The court rejected the UAW's argument that benefits as set out in previous CBAs were vested and could not be changed. According to the opinion, previous CBAs stated the benefits would be provided 'for the duration of the Agreement.'" (PLANSPONSOR.com; free registration required)
Union Pension Plans Hurt Workers, Study Shows
Excerpt: "Unlike non-union plans, collectively bargained pensions are often underfunded, lack portability and cannot respond quickly to market forces, according to the authors of a new study. Although labor unions often promote defined benefits plans for recruiting purposes, many of these plans are under severe financial pressure and place workers at a disadvantage, according to Diana Furchtgott-Roth, a senior fellow with the Hudson Institute and her colleague Andrew Brown." (The Washington Examiner)
[Guidance Overview] Third Circuit Applies Arbaugh Test to Find Jurisdiction Under LMRA Section 301
Excerpt: "The Third Circuit found another context in which Arbaugh v. Y & H Corp., 546 U.S. 500 (2006) applied to relax the jurisdictional nexus of a federal claim with the elements of a cause of action. In this instance, the jurisdictional issue arose over the application of section 301 of the Labor Management Relations Act ('LMRA'), 29 U.S.C. ? 185. The arrangement at issue was an agreement by a union to indemnify an employer for the employer's withdrawal liability to a pension plan under the Employee Retirement Income Security Act of 1974, 29 U.S.C. ?? 1001-1461 ('ERISA'), and the Multiemployer Pension Plan Amendments Act of 1980, 29 U.S.C. ?? 1381-1461 ('MPPAA'). The indemnification agreement was entered into to facilitate an asset sale by the employer to another entity." (Roy Harmon III via Health Plan Law)
[Official Guidance] Text of Rev. Proc. 2009-43: Revocation of Elections by Multiemployer Defined Benefit Pension Plans to Freeze Funded Status under section 204 of WRERA (PDF)
5 pages. Excerpt: "Section II of this revenue procedure sets forth . . . circumstances [in addition to those in Notice 2009-42] in which the Service will automatically approve a request to revoke a section 204 election. Section III sets forth the procedures for submitting a request for automatic approval of revocation of a section 204 election. Section IV addresses other requests for approval to revoke a section 204 election." (Internal Revenue Service)
Cost Management Strategies for Multiemployer Health Funds During Sustained Economic Downturns (PDF)
4 pages. Excerpt: "As the nation awaits national health care reform, trustees of multiemployer health funds are facing immediate and longer term challenges related to the still distressed economy. Utilization patterns may change in some ways that increase costs in the short term and in other ways that compromise participants' health over time. As expenditures rise and continued low levels of employment lead to reductions in overall contributions, health funds may be depleted. This NewsLetter is devoted to steps that trustees can take now to ensure that plan costs stay within budgets by looking carefully at cost sharing, plan design and vendor performance." (The Segal Group, Inc.)
[Official Guidance] Typeset Version in Federal Register: DOL (EBSA) Proposed Regs on Civil Penalty Rules for Multiemployer Defined Benefit Pension Plans That Fail to Take Corrective Funding Action (PDF)
5 pages. Excerpt: "This document contains a proposed regulation that, upon adoption, would establish procedures relating to the assessment of civil penalties by the Department of Labor under section 502(c)(8) of the Employee Retirement Income Security Act of 1974 (ERISA or the Act). Under section 502(c)(8) of ERISA, which was added by the Pension Protection Act of 2006, the Secretary of Labor is granted authority to assess civil penalties not to exceed $1,100 per day against any plan sponsor of a multiemployer plan for certain violations of section 305 of ERISA. The regulation would affect multiemployer plans that are in either endangered or critical status." (Employee Benefits Security Administration, U.S. Department of Labor)
[Guidance Overview] EBSA Proposes Civil Penalty for Multiemployer Pension Plans that Fail to Correct Funding
Excerpt: "The Employee Benefit Security Administration (EBSA ) issued a News Release today, which proposes civil penalty rules for multiemployer defined benefit pension plans that fail to take corrective funding action under ERISA Section 502(c)(8) . . . ." (Workplace Prof Blog)
[Official Guidance] Text of DOL (EBSA) Proposed Regs on Civil Penalty Rules for Multiemployer Defined Benefit Pension Plans That Fail to Take Corrective Funding Action (PDF)
19 pages. A typeset version will be published in the September 4, 2009 Federal Register. The attached version was submitted today at 8:45 a.m. by the EBSA to the Electronic Public Inspection Desk of the National Archives. (Employee Benefits Security Administration, U.S. Department of Labor)
[Guidance Overview] EBSA Proposes Regulations on Civil Penalty Rules for Multiemployer Defined Benefit Pension Plans That Fail to Take Corrective Funding Action
Excerpt: "The PPA amended ERISA and the Internal Revenue Code to require those plans certified to be in endangered or critical status to adopt a funding improvement plan or a rehabilitation plan within 240 days from the required date of the certification. PPA also gave the Labor Department authority to assess civil monetary penalties of up to $1,100 per day against plan sponsors that fail to timely adopt funding improvement or rehabilitation plans. The proposed regulation sets forth the administrative procedures for assessing and contesting such penalties." (Employee Benefits Security Administration, U.S. Department of Labor)
[Guidance Overview] New Form 5500 Reporting Requirements for 2008 Plan Year for Multiemployer Defined Benefit Pension Plans (PDF)
2 page chart. (Milliman)
Pension Insurance Data Book 2008 (PDF)
122 pages. Excerpt: "This edition of the Pension Insurance Data Book contains one short article describing the characteristics of plans that PBGC newly insured during 2006. The edition also contains two new tables, inserted at tables S-36 and S-37, that show the number of hardfrozendefined plans insured by PBGC and the number of participants in these plans." (Pension Benefit Guaranty Corporation)
Pomeroy Continues Filling Out Defined Benefit Funding Package Proposal
Excerpt: "A long-in-the-making package of pension reform legislation from U.S. Representative Earl Pomeroy (D-North Dakota) continues to move toward formal introduction when Congress reconvenes in September. Pomeroy on Thursday released the latest version of the bills collectively designed to help defined benefit pension plans continue to weather the funding issues arising out of the economic downturn, according to a news release from his office. Pomery included suggestions from various interested parties with whom he consulted after initially releasing the suggested bills in June 2009 (see Pomeroy Shares Pension Funding Reform Thoughts). The proposals cover both single-employer and Taft-Hartley plans. [The article provides summaries of both TITLE I -- Single Employer Plans Legislation and TITLE II -- Multiemployer Plans Legislation.]" (PLANSPONSOR.com; free registration required)
Options for Troubled Multiemployer Pension Plans in a Post-PPA World (PDF)
Excerpt: "Over the past two years, multiemployer pension plans have been challenged from two directions -- they have had to learn to function under a very different set of funding rules under the Pension Protection Act of 2006 (PPA)i while grappling with sharp investment losses and a severeeconomic slowdown. As a consequence, many trustees find themselves fighting an uphill battle to stabilize their multiemployer plans. This article focuses on the tools available to address the serious financial problems facing multiemployer pension plans now." (International Foundation of Employee Benefit Plans via Groom Law Group)
Affordable Health Choices Act of 2009 Bill Bails Out Union Pension Plans, Too
Excerpt: "Section 164 of the Affordable Health Choices Act of 2009 provides that the government pay 80 cents on the dollar to corporate and union insurance plans for claims between $15,000 and $90,000 for retirees age 55 to 64. Union health insurance funds only have about 30 cents available to cover each dollar of anticipated claims, according to the Lewin Group and other research outfits." (The Examiner)
Important New Online Official Survey Asks How the New Retirement Plan IRS Determination Letter Process is Working, How It Might Be Improved
An IRS advisory council is studying the retirement plan document determination letter process. A new online survey form asks for the views of employers, benefits attorneys, third-party administrators, consultants, providers of master & prototype documents, and other stakeholders. In 2005 the IRS radically changed the determination letter process by creating 5-year and 6-year cycles for amending and filing individually designed, volume submitter, and M&P retirement plan documents. Further changes were made in 2007. The advisory council wants to know how the process is working and how it might be improved, including the process for making required amendments or restatements. To learn more or take the survey now, click on the following address or copy and paste it into your web browser: http://www.surveymonkey.com/s.aspx?sm=EL2r2msS3KJI07X_2fq67w6w_3d_3d (IRS Advisory Committee on Tax Exempt and Government Entities (TE/GE))
[Guidance Overview] Multiple Employer Plans: The Platinum Standard
Excerpt: "The acceptance by a full-scope ERISA section 3(21) fiduciary of [the] duties with respect to a qualified retirement plan such as a 401(k) plan is the gold standard of delegation of fiduciary responsibility (and liability) by a plan sponsor because it encompasses all other fiduciary duties. The only liability retained by the sponsor in these circumstances would be a residual oversight monitoring duty. . . . But what if a plan sponsor could jettison even its residual oversight monitoring duty of the full-scope ERISA section 3(21) named fiduciary? That kind of power would represent the platinum standard of delegation of fiduciary responsibility (and liability) by a plan sponsor. In fact, ERISA allows a plan sponsor to do exactly that. A plan sponsor can do so by joining a multiple employer plan (MEP) pursuant to section 413(c) of the Internal Revenue Code (IRC)." (Morningstar, Inc.)
National Football League Says Retirees Don't Face Benefits Cut
Excerpt: "The National Football League and the players union are a long way from agreeing on a new collective bargaining agreement. One problem: they cannot even agree on what will happen if there isn't one. For weeks, DeMaurice Smith, the executive director of the union, has said that if the league plays without a salary cap in 2010 -- which looks increasingly likely unless a deal is completed by March -- the benefits and pension payments that the owners make to retired players could be slashed. . . . The league added that Smith had never raised the issue in conversations with Commissioner Roger Goodell. 'Simply put, those claims have no basis in fact,' Goodell wrote. 'The facts are that since at least the fall of 2007, the owners have consistently agreed and planned that they will not reduce the funding for pension or disability benefits for retired players.'" (The New York Times; free registration required)
[Opinion] Another Taxpayer Donation to GM and the Auto Workers Union
Excerpt: "Welcome to the General Motors bailout, part three -- or is it four, or five? It's hard to keep up, but this week the federal Pension Benefit Guaranty Corporation took over the pension liabilities of Delphi, the auto-parts spinoff of GM that has been working its way through Chapter 11 since 2005. As with the previous taxpayer rescues, this one includes a special favor for the United Auto Workers. Under the agreement, the PBGC will assume some $6.2 billion in pension liabilities from Delphi, including both hourly and salaried employees. That's the second biggest pension bailout in PBGC history, and it takes billions of liabilities off the books for GM. As Delphi's former parent, GM had agreed to take responsibility for billions of dollars of Delphi's pension obligations to its hourly employees." (The Wall Street Journal)
Union Pensions in the Red: Labor Chiefs Are Doing Better Than the Workers
Excerpt: "We've all read about underfunded corporate pensions, but here's an unreported story: Union pensions are even more in the red, and it's one reason union chiefs are so eager to rig organizing rules to gain more dues-paying members. Only last week, the country's largest union local re-opened the contract for its 145,000 members two years early and gave up raises and reduced retirement benefits for future hires. The SEIU's United Healthcare Workers East struck this unusual deal so employers could instead plug a gaping pension hole." (The Wall Street Journal)
Two 'Big Picture' Pension Policy Issues of Interest to IRS Addressed by Seventh Circuit During 2009 Spring Term (PDF)
Excerpt: "In March, the court decided Contilli v. Local 705, Int'l Bhd. of Teamsters Pension Fund, 559 F.3d 720 (7th Cir. 2009) (Easterbrook, J.). In July, the court decided Fry v. Exelon Corporation Cash Balance Plan, 2009 U.S. App. LEXIS 14395 (7th Cir. 2009) (Easterbrook, J.). Contilli was a clear win for the IRS. Fry a resounding loss." (Ivins, Phillips & Barker)
Feds Say Adviser Embezzled from Union Pension Funds
Excerpt: "The president of AA Capital Partners embezzled $24 million from union pension funds, federal prosecutors say. John Orecchio siphoned $24 million from the $169 million he controlled for five pension funds, according to the criminal information. Orecchio allegedly embezzled the money from 2002 to 2006, as investment manager at AA Capital. He and AA Capital had control over the unions' ERISA plans and 'full discretion over the investment and re-investment of funds,' prosecutors said." (Courthouse News Service)
Summer 2009 Report of Results from Segal Study of Multiemployer Defined Contribution Plans (PDF)
4 pages. Excerpt: "This survey summarizes the results of that study, which reflects information for just under 140 funds, all but two of which are Segal clients. The study sample represents 9 percent of all multiemployer plans. Key survey findings include: An overwhelming majority of the DC plans in the study (82 percent) are companions to DB plans sponsored by the same unions and contributing employers for the same active workers. Although trustees direct investments for more than half of the DC plans in the study (58 percent), a large percentage of the plans (42 percent) allow participant-directed investments. A large majority of the multiemployer plans in the study (83 percent) offer payment options in addition to lump sums at retirement." (The Segal Group, Inc.)
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