Massachusetts (!) thinking of regulating employer stock in 401(k) plan

[Dave Baker]

Several interesting articles in the media today, re the Massachusetts Secretary of State's interest in prohibiting employers from locking employees into company stock in a 401(k) plan ...

http://www.boston.com/dailyglobe2/339/busi...k_policy+.shtml

http://news1.iwon.com/article/id/191722|po...28|reuters.html

Does anybody think such a law would have more than a snowball (in hell)'s chance of avoiding ERISA preemption?

[Demosthenes]

This is political grandstanding, good for some sound bites and a couple of paragraphs in the Boston media. Much sound and fury signifying nothing.

Even if ERISA didn't pre-empt the legislation (which it does), the existence of thousands of corporations with multi state employees would make the administration a screaming nightmare.

[Guest hank]

Demo, I agree about the complete preemption of the proposed Mass. bill. If it somehow survived preemption, as a multi-state employer which matches in stock, our plan design would certainly not change, but we would think pretty hard about carving the Massachusetts employees out of the plan. So take that, Secretary Galvin!

[mwyatt]

A few words from a Mass. resident:

The Mass. gubernatorial election is next year (2002). Does anyone want to take a guess as to who has been pushing himself as a candidate for the race (including state-funded mailings stating what a great job he is doing?).

Don't spend a bunch of time on this one... political grandstanding with no chance of implementation (after all, there are a few of us here in Boston who know how to spell E-R-I-S-A P-R-E-E-M-P-T-I-O-N ).

[Guest ksuhre]

I agree it's got the same chance as a snowball in Dallas in July. However -- some U.S. Congressman with a lot of Enron employees in his district will undoubtedly pick up the refrain at some point when they get done gridlocking over the stimulus package etc.

[david rigby]

I would not know the details but I recall seeing many (dozens?) court cases where the answer was exactly that: sorry, this law does not apply because of ERISA pre-emption. End of discussion.

Probably several of these originated in Mass. Perhaps even some were decided in federal court in Boston. Might be interesting to hear how the Mass. Secretary of State reacts to actual facts.

[Steve72]

Don't forget, Massachusetts is also the state that attempted to have its own foreign policy with regard to Burma. This attempt to displace Federal law seems pretty much par for the course.

(Disclaimer: I grew up in New England and lived several years in Boston. This post is very much tongue-in-cheek, and should not be seen as impugning the great Commonwealth of Massachusetts)