| BenefitsLink Retirement Plans Newsletter |   |
July 15, 2003 - 13,238 subscribers
Today's sponsor: FreeERISA.com
(Click on company name or banner to learn more.)
Instant access to millions of benefit filings with FreeERISA.com FreeERISA.com provides instant access to millions of employee benefit filings from around the country, as well as numerous articles and databases specifically geared towards people in the pension and welfare markets. FreeERISA.com also provides on-demand documents retrieval at a variety of government agencies. Get the information you need - fast!
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
IRS Final Regulations on 'Annuity Starting Date' Definition for Defined Benefit Plans (PDF)
Excerpt: "In accordance with section 417(a)(7)(A), these regulations provide that the QJSA explanation may be furnished on or after the annuity starting date under certain circumstances. The regulations refer to the annuity starting date in such cases as the "retroactive annuity starting date", define how payments are made in the case of a retroactive annuity starting date, and set conditions for the use of a retroactive annuity starting date." (Internal Revenue Service)
Overview: Final Catch-Up Regulations Exempt Union Plans (PDF)
2 pages. Excerpt: "[A]n employer can permit catch-up contributions for all (but not less than all) of its non-union employees without being required to permit them for union employees; it also means that an employer can agree with one union to include catch-up contributions in the plan covering that union's members without being required to offer them to other unions." (Seyfarth Shaw)
Overview: IRS Releases Final Catch-Up Regulations (PDF)
2 pages. Excerpt: "The most significant change in the final regulations is the exclusion of collectively bargained employees and certain nonresident aliens from the universal availability requirement." (Kilpatrick Stockton LLP)
ASPA's Written Testimony at Hearing on Bush Administration Proposal to Replace 30-Year Interest Rate
Excerpt: "After further review, ASPA may very well conclude that a yield curve approach, appropriately refined, is a reasonable approach to replacing the 30-year Treasury bond rate. However, ASPA strongly believes that a significant change to the funding rules, such as the yield curve proposal, should only be considered in the context of a complete review and possible additional revisions respecting the overall funding rules." (American Society of Pension Actuaries)
American Benefits Council's Position Paper on Treasury Department's Yield Curve Approach (PDF)
2 pages. Excerpt: "The most serious threshold problem is that a yield curve concept is just that-- a concept, an idea-- and one that is highly controversial at that.... [Also, a] yield curve approach to measuring pension plan liabilities would increase the volatility of these liabilities." (American Benefits Council)
American Benefits Council's Position Paper on Effect of Pension Interest Rates on Distributions (PDF)
2 pages. Excerpt: "As policymakers consider proposals to replace the 30-year Treasury rate for pension calculation purposes, it is important that a consistent replacement rate be found for both pension funding and lump sum calculation purposes.... The use of the obsolete 30-year Treasury rate to calculate lump sum distributions greatly inflates the value of those lump sums for departing employees." (American Benefits Council)
American Benefits Council's Position Paper on Pension Interest Rate Replacement (PDF)
3 pages. Excerpt: "If the 30-year Treasury bond interest rate is not replaced for pension purposes, there will be serious and negative consequences for the employer-sponsored defined benefit pension system." (American Benefits Council)
Los Angeles County, Calif., Takes $190 Million Pension Hit Under Court Ruling
Excerpt: "A state appeals court decision giving eight years of back pension payments to thousands of retired county workers could cost Los Angeles County $190 million ... The 1st District Court of Appeal based its ruling ... on a 1997 state Supreme Court decision requiring that extra pay should be added to public employees' regular salaries in determining their pensions and that they are entitled to the added value to their pensions back to 1995." (The [Los Angeles] Daily News via NewsAlert.com)
ERISA Lawsuits Accuse BellSouth, Scientific Atlanta Executives of Breach of Fiduciary Duty
Excerpt: "Two of Atlanta's largest companies are being sued by current and former employees who claim executives violated federal laws while managing company retirement plans. At issue is whether executives of BellSouth Corp. and Scientific-Atlanta Inc. upheld their fiduciary duty to plan members. The lawsuits claim executives who knew of operational problems at both companies encouraged employees to purchase stock for their plans, sometimes while selling shares themselves." (Atlanta Business Chronicle via bizjournals.com; one-time registration required)
Overview: Proposed Reg Drops 90-Day Advance Notice for Eliminating Optional Forms of Benefit
Excerpt: "This conforming amendment to the anti-cutback regulations is welcome news to plan sponsors. By eliminating the 90-day advance notice requirement, plan sponsors will have more flexibility in the timing of their communications to participants when eliminating optional forms of payment. It is important to emphasize, however, that this change, when finalized, will not relieve plan sponsors of their obligation to notify participants under the normal SMM and SPD notice requirements." (EBIA Weekly)
Analysis: Exchange of Annuities Qualifies Under Code Section 1035
July 14, 2003. Excerpt: "In a recent private letter ruling, the IRS ruled that the exchange of two annuity contracts held within a trust for a third contract that will be owned directly by an individual will qualify as an exchange under IRC Section 1035." (National Underwriter's Tax Facts)
ESOP's Fable Forced United Airlines to the Brink
Excerpt: "Tens of thousands of United employees agreed to roughly $5 billion in pay and benefit cuts to get a majority of the airline's stock and influential seats on the carrier's board. But what started as a grand, almost utopian, experiment eventually would unravel into recrimination and resentment." (Chicago Tribune; one-time registration required)
Another Question is Answered in the Davis-Bacon Act Q&A Column
Can the prevailing wage deposits be used to satisfy the Safe Harbor employer match contribution? (BenefitsLink.com)
Links to Items on Executive Comp, Benefits in General
Plan's Failure to Respond to Benefit Appeal Precludes Use of Deferential Standard of Review by Court
Seman v. FMC Corp. Retirement Plan for Hourly Employees (8th Cir. 2003). Excerpt: "[T]he Eighth Circuit [in this case articulates] its own test for what should happen when claims decisions are not issued. The test distinguishes between failure to act on an initial claim and failure to act on an appeal ... EBIA Comment: This is the third appellate court case we have seen in less than a year in which a plan lost the deferential review standard by failing to issue a timely appeal decision." (EBIA Weekly)
Don't Write Obituary for Stock Options Just Yet
Excerpt: "When Microsoft announced last week that it would no longer give its employees stock options, it was a stunner: the business equivalent of Lance Armstrong vowing never to ride a bike again ... What was remarkable about Microsoft is that founder Bill Gates was never greedy enough to take options for himself." (Washington Post)
Fill Out the 2003 Spencer Survey of Benefit Managers
Aspen Publishers Spencer Benefits Reports currently is collecting information for the 2003 Spencer survey of benefit managers and employee benefits departments. This 9th biennial survey requests information concerning compensation, organization, and functional responsibilities of corporate employee benefits departments. The information provided will be collated and published by Spencer Benefits Reports. All survey respondents will receive a copy of the published survey at no charge. (Spencer Benefits Reports)
Newly Posted or Renewed Job Openings
Defined Benefit New Business Consultant
for New York Life Investment Management, LLC
in MA
Senior Compliance Specialist
for The Segal Company
in MA
Financial Planning Manager
for ICMA Retirement Corporation
in CA, CO, FL, IL, VA
Defined Benefit Plan Administrator
for 401k Plus, Inc.
in TX
Benefits Analyst
for CPE
in CA
Benefits Coordinator
for Financial Service firm
in NY
401(k) Client Relationship Manager
for Great West Life & Annuity
in CA
Manager III, Human Resources
for Amgen
in CA
Newly Posted Press Releases
(Post Yours!)
Treasury and IRS Issue Final Regulations for Retroactive Annuity Payments from Pension Plans
(Internal Revenue Service)
Travel Assistance Leader Adds New Services for Corporations
(Worldwide Assistance Services, Inc.)
Declines in Pension Plan Funding Levels Accompanied by Large Increases in Deferred Costs, Towers Perrin Study Shows
(Towers Perrin)
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
Copyright 2003 BenefitsLink.com, Inc.; except that you can forward this email in full (including this boilerplate part) or otherwise reprint this email in full (including this boilerplate part) without obtaining our permission.
Published by:
BenefitsLink.com, Inc.
https://benefitslink.com/about.html
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
Editor and Publisher: David Rhett Baker, J.D.
Housekeeping: